Inflation: Dal gets pricey, thanks to patchy monsoon in main growing states

Prices of tur and urad have risen in the last few days over fears that scanty rain could have an impact on the kharif harvest

After a gap, the prices of select varieties of pulses have started rising for the past few days due to a delay in the onset of the southwest monsoon over major growing regions of Madhya Pradesh, Maharashtra, and Gujarat.

Trade and market sources said between last week and Tuesday, the prices of tur had risen by around 5 per cent in major wholesale markets of India, while those of urad had gone up 3-4 per cent over fears that scanty rain could have an impact on the kharif harvest.

The data showed the acreage of pulses till June 24 across the country was around 36 per cent less than in the same period last year. Of this, the tur area was around 55 per cent lower than last year and urad around 52 per cent down.

“First it was expected the rains would come on June 10, and then around June 15. And now even June 28 has passed while there hasn’t been any strong upsurge in the rains,” Suresh Agarwal of the All India Dal Mills Association told Business Standard on the phone from Indore. Agarwal said as soon as the rains arrived in a big way, the markets would stabilise because fears of a delayed harvest would ease.

In Chennai, FAQ urad was quoted at Rs 7,250-7,350 per quintal on Saturday. It rose to Rs 7,425 per quintal in early opening trade on Tuesday. In the case of tur, the prices in the Chennai market were around Rs 6,300 per quintal last week. Those jumped to Rs 6,325-6,450 on Tuesday.

Among other varieties of pulses, the prices of masoor and moong are hovering around the same levels this week as last week while that of chana has softened marginally during the same period.

“April to June are relatively weak months for pulses demand as alternatives are available to consumers and this price spike is mainly due to a delay in the monsoon onset,” said Rahul Chauhan, commodity analyst at iGrain India.

Patchy rains

The latest data from the India Meteorological Department (IMD) showed till June 28, the cumulative rain deficit across the country has widened to 10 per cent. Of this, in the critical pulses-growing regions of Central and North-West India, rain till June 28 was around 31 per cent and 19 per cent lower than normal.

Hope on the horizon

The IMD said conditions were favourable for a further advance of the southwest monsoon into the remaining parts of Bihar, some more parts of Uttar Pradesh, and some areas of Uttarakhand, Himachal Pradesh, and Jammu and Kashmir during the next 24 hours. It will penetrate other parts of North and Central India also during June 30-July 1. Motilal Oswal Financial Services in a research note said month-wise rain in calendar year 2020 showed June received 19 per cent of the season’s precipitation, July almost 33 per cent, followed by August at 29 per cent. In 2021, while June received 21 per cent of the rain, July got 30 per cent, followed by August at 22 per cent.

“Therefore, however gloomy the situation may seem currently, it is still too early to draw any conclusions,” the note said.

It further said the critical water reservoir level as of June 23 was at 29 per cent, lower than last year (32 per cent) during this time, but higher than the average 26 per cent of live storage capacity in the previous five years.

“Even compared with historical standards, barring the previous two years (FY21 and FY22), the reservoir level of 29 per cent is acceptably high,” Motilal Oswal said in the note.