Pulses dealers seek 15% cap on retail margins

Faced with huge price difference between the wholesale and the retail prices of pulses, dealers and importers have urged the government to cap margins of wholesalers. They want the margins to be capped at a maximum of 15 per cent for consumers to get the benefit of sharp fall in prices of pulses in the wholesale markets.

A survey conducted by the industry body India Pulses and Grains Association (IPGA) showed huge price difference between the wholesale price and retail prices. For example, the Survey finds average packaged tur price in Delhi retail market at Rs 205/kg on August 29.

Data compiled by the Ministry of Consumer Affairs (MCA), however, showed tur price at Rs 122 /kg in Delhi market on Wednesday, a sharp decline from Rs 161 /kg on January 1 this year. 

"We have not asked for any for action. We have told the government that the import prices vary on supply and demand being such a large market. It cannot be manipulated or controlled by anyone. But, the difference has enlarged in the prices of finished products between organized retail and ex-mill (as importers deal in whole grain i.e. raw material for milling and processing in local dal mills) over the last one and a half years. Since consumers are looking at those prices prevailing in organized retail which importers have nothing to do," said Pravin Dongre, Chairman, IPGA.

The Survey discovers that pulses (tur and urad) prices have declined in the wholesale markets to trade currently at Rs 105-110 a kg but large retail shops including organized ones have continued to sell at elevated price with a slight marginal decline. In Mumbai, according to the Survey, tur, urad and chana were selling at Rs 186 a kg, 237 a kg 148 a kg late last month as compared to Rs 103 a kg, 128 a kg and Rs 95 a kg of their price quoted by dal mills.

This means, retailers margins stood at upto 100 per cent which need to scale down for consumers to get benefit of price decline in the wholesale markets.

"The government need to control price in the hypermarkets and large organized retail formats that keep pulses prices elevated with their margins at 50-60 per cent. Since pulses prices have cooled down in the wholesale markets, they need to be passed on to consumers which because of these large and organized retail shops, is not happening. Therefore, the government needs to cap the margins at 15 per cent and call for monthly report for their purchase and selling prices of pulses and also audit their statement of facts on regular basis," said Pradeep Jindal, President, Delhi-based India Beans and Pulses Association.

India imported a record 5.8 million tonnes of pulses to meet its rising demand and bridge the deficit arisen from low domestic production at around 15 million tonnes last year.

"The government needs to encourage farmers through timely procurement of their produce with higher minimum support price, for sowing more pulses to meet the production deficit in India," said S P Goenka, Director, U Goenka & Sons, a city based pulses importer.

A senior executive of a corporate house which recently entered into packaged pulses retailing, said, "The turnaround time for pulses stands at around 30-35 days. So, the price decline in wholesale markets would reflect only at the time of next cycle of procurement".