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The shortage in the total production of the pulses is only 0.1 million tonne (mt) in 2007 and 2009. In India, the production was 14.76 mt. This year, the pulse production in India has gone down to 14.66 mt. But this little fluctuation in the rate of the production has been able to set the pulse prices high by minimum of 18% for chana in only about three months. Arhar, which is consumed in larger amounts in both rural and urban India, has seen an increase of 53% in its price during the same period in the markets of Delhi.
The reason behind this problem is that the consumption of the lentil is very high in India and does not leave scope for its buffering for the year when production goes down, even marginally. The farmers also cannot do much about the price as futures trading in pulses in India is not allowed.
As stated in the Assocham report, the aggregate annual growth rate of pulses has increased by 1.4% over the last two decades and the population rose by 1.8%. This in turn has resulted in the decline of the per capita availability of pulses from 16 kg a year to only 12.7 kg.
According to the Central Statistical Organisation, the per capita income has grown by a CAGR of 6% in the past 10 years alone leading to change in food habits of Indians. Now, instead of rice and wheat, the population is mostly consuming pulses for a more balanced diet. The present rise in pulse price may hence hamper this balance.
Sharad Pawar, the agriculture minister, has admitted that there is definitely a problem. But he told that the lower production has intensified the problem of shortage. He also added that “This year also, the areas where we generally get pulses have had less rain. These are essentially rain-fed areas”.
Not only this, the late arrival of the southwest monsoon has only added to the problem of recovery anytime soon. Along with these, little can be seen on positive side as the supplies can not be improved for the coming three months when the major festive season is about to start. This will see imbalance in price. In the states of Gujarat and Madhya Pradesh in India, the traders are asking for Rs 150 per kg for arhar for delivery for the coming three months.
The efforts put in by the government are also not yielding desired results as main pulse producing countries like Myanmar, Canada and Australia are also witnessing an aggregate shortfall in pulses. The farmers in these countries are concentrating on the production of corn and oilseeds considering international prices.
It is held that the policy of disallowance of futures trading in pulses is causing the main problem. Farmers have no means by which they can track the price of the pulses and hence they show little or no interest in growing it. In addition, there is no way by which the shortfall can be balanced or the price signal can be created for the farmers to respond.
KC Bhartiya, the president of Pulses Importers’ Association, said that “there is very little chance of any significant drop in pulses prices at least for the next three to four months because the import cost is much more than domestic prices, while local supplies are almost nil”.
Traders revealed that the present landed cost of tur or arhar is about Rs 6,200 per quintal. However, the current market rate of this increases when processing charges and freight are added. The same is applicable for Urad. The landed cost of Urad in Mumbai is about Rs 4,100 per quintal.
In Mumbai, the price of tur, since the middle of the month of April, has increased to about Rs 75 a kg from Rs 21. According to data given by consumer affairs ministry, the price for tur in Kolkata has increased by Rs 30 in three months. Other pulses are also seeing price hike. In Delhi, gram prices have soared by Rs 6 in three months. In Shimla, the cost of gram has increased by Rs 7 to around Rs 38 per kg from the middle of April. The Financial Express
July 23, 2009
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