Published On : Tue, Jun 23rd, 2015

Rising food grain prices – Indian ineptitude or global phenomenon?

Nagpur: In India, it is a norm for husbands to shop for groceries while the wife does the cooking and home management. At the most, a list is handed over which the hubby ticks marks as he loads stuff into the cart for billing or calls out to the grocer’s boy to pack and get to the counter for billing.

After the June -July shopping many men are in a state of shock. What they got for x amount till now is suddenly costing 50% more ! So if the monthly bill used to be Rs. 3000/ approximately it has jumped to Rs. 4500/ at least.

House holds that shop for the whole year are more dazed – they never saw the price rise coming!

Price of dals hit the hardest

All dals are now over Rs. 100/ a Kg. with moong dal being the costliest. But customers will remember that the same phenomon had happened last year too. This is from a report from June 2014 – ‘The prices of tur dal, urad dal and moong dal move up while rest of the commodities remained unaltered in the wholesale foodgrains market here today. Moong dal rose steeply by Rs 400 per quintal to Rs 9,400 from its closing rate of Rs 9,000. Urad dal opened the week at Rs 8,200, an increase of Rs 200 per quintal from its last rate of Rs 8,000.’

This year, the rates have again gone up by 15 to 20%, and going up steadily month by month. For instance, in February this year, in Delhi markets, tur dal, masoor and urad dal were still available in the range of Rs. 83/ to Rs. 85/ a Kilo and only mung dal was over Rs. 100/ As mentioned above all of them have jumped not just over Rs. 100/ but over Rs. 115 on an average.

Why the increase?

Experts say prices for pulses – a key source of protein in a largely vegetarian country – and chicken have soared to record highs because of the unusual weather this year.

Amit Magre, a director of Bajrang Pulses and Agro Products, says the production of pulses has been so bad that he’s now importing them, and running a single daily shift at his mill compared with three last year. “Even if we assume monsoon delivers good rainfall, new crop supplies will start from October onwards. Until then, prices will remain elevated,” he said.

The government was lauded last year for its efforts to keep a rein on inflation despite lower-than-expected rainfall, a push that largely consisted of releasing wheat and rice from government-run warehouses and cracking down on hoarders.

But it does not have stockpiles of vegetables, chicken and pulses. Importing them is difficult and costly, as pulse production remains low elsewhere, while vegetables and chickens are too perishable.

Any relief would need to come, in time, from production, as farmers respond to price rises by increasing output. But not all will be able to.

Babasaheb Khole, a pulses farmer from a village outside Aurangabad, said he’d like to increase the area under crop, but couldn’t afford the seeds. “I incurred huge losses due to last year’s drought. I couldn’t repay the bank loan and now the bank is refusing to give me a fresh loan,” he said.

It is strongly believed that large increases in biofuels production in the United States and Europe are the main reason behind the steep rise in global food prices. Urbanization and industrialization (mostly in the developing and emerging economies) are encroaching into the areas meant for farming, adding to the crisis. All these complexities call for multi-pronged policy initiatives.

Many experts feel that agriculture and food issues need to be looked at in a more holistic manner with particular attention to the sustainable use of scarce land and water resources, livelihoods of poor farmers, along with concerns for ecology and the environment, with an increasing role of science and technology in the transformation of agriculture. It is imperative that farmers be given improved and attractive minimum support prices as a means for sustaining agriculture. The world over, agriculture is in peril and is sustained with governmental support. That must continue. Policy parameters must be tightened so as to make speculative trading in commodities unsustainable, thus curbing its exploitative tendencies. Of course, this is easier said than done.

Sunita Mudliyar ( Associate Editor )