In July, 2023, the consumer food price index rose 11.5% on year because of higher tomato and cereals prices, but it had declined in August and September to 9.94% and 6.62% respectively with the softening of tomato prices.
Annual food inflation in retail markets came in at 6.61% in October, the same level as in the previous month and compared with 7% in the year-ago month.
But the relevant consumer food price index (CFPI) recorded a sequential rise of 1.16% as prices of onion, pulses and spices firmed up. Sequential decline in inflation was, however, witnessed in edible oils.
In July, 2023, the consumer food price index rose 11.5% on year because of higher tomato and cereals prices, but it had declined in August and September to 9.94% and 6.62% respectively with the softening of tomato prices.
Retail onion inflation rose by 42.08% on year in October as retail prices in several cities touched Rs 90/kg last month because of delay in arrival of kharif crops and reports of decline in production in Maharashtra and Karnataka.
Officials said that prices of onion have declined in the last couple of weeks, but are likely to be at elevated levels compared to last year in the coming months because of decline in kharif crops prospects.
The government in August had imposed 40% export duty on exports of kitchen bulbs to improve domestic supplies.
Inflation in pulses rose to 18.7% in October this year from 16.38% in September while arhar variety of pulses reported a price rise of 41%. Prices of other varieties of pulses – moong (12.75%), gram (11.16%) and Urad (9.26%) also rose last month.
Decline in production and robust demand are the key factors that contributed to the rise in pulses inflation, officials said.
“While the uptick in foodgrain prices following an uneven monsoon has manifested in prices in October, higher prices of some vegetables like onions would be partly absorbed by the typical seasonal downtrend in many other vegetables, offering some respite,” Aditi Nayar, Chief Economist, ICRA said.
Overall cereals inflation last month was still at the double-digit level of 10.6% although it declined from 10.95% in August because of some softening of wheat prices.
Inflation in wheat declined further to 7.61% last month from 7.93% in September on year because of improvement in supplies due to open market sale being carried out by the Food Corporation of India (FCI). The corporation has sold 3.3 MT of wheat in the open market through weekly e-auction so far since June.
Retail rice prices rose by 11.64% in October, marginally lower from previous month. The government has banned exports of white rice and imposed 20% export duties on par-boiled rice to improve domestic supplies.
The inflation in ‘spices’ rose to 22.7% in October as jeera (cumin seeds) prices rose sharply by 125% last month. Global and domestic supply constraints have pushed up jeera prices sharply since the beginning of the year.
Inflation in oil and fats categories declined by 13.7% last month. For mustard oil, prices declined by 17.7% in October 2023. Inflation in refined oil (sunflower, soybean and palm) also declined by 22.5% last month on year because of a decline in global prices of edible oil and bumper domestic output.
India imports about 56% of the total annual edible oil consumption of around 25-26 MT.
Milk inflation last month was 6.38%, marginally lower from the previous month.
Source:financialexpress.com