Cereals, milk, vegetables turn costlier on month; potato prices zoom

Retail food inflation softened marginally to 8.52% in March, 2024 from 8.66% in previous month due to sequential drop in prices of pulses an edible oils and spices, and a high base. The prices of key items like cereals, milk, meat and vegetables, however, saw a rise on a month-on-month basis.

The relevant consumer food price index (CFPI) last month recorded a sequential rise of 0.16% on months. Annual food inflation in March, 2023 was 4.73%.

Milk and products prices rose by 3.38% last month on year, a marginal decline of 3.86% in February, 2024 on year. Inflation in pulses declined marginally to 17.71% in March from 18.9% in February, 2024 while arhar variety of pulses reported a price rise of 33.54%.

Inflation in vegetables was 28.34% in March, while prices rose by 30.25% in February, 2024 on year. Annual rise in retail prices of potato last month was 41% against an increase of 12.38% in February, 2024. Inflation in potato had remained in negative zine between February, 2023 to January, 2024.

Retail inflation in onion rose to 36.88% last month, while price rose by 21.87% in February, 2024 on year. However tomato prices rose by 32.52% last month against 41.83% rise in February, 2024 on year.

While projecting food and beverages inflation to remain above 7% mark in April, 2024, Aditi Nayar, chief economist, ICRA said an intensification of the impending heatwave may worsen the seasonal uptick in prices of perishables, heightening the criticality of a favourable monsoon in 2024 to keep food inflation in check.

Overall cereals inflation last month rose to 8.37% from 7.6% on year in February, 2024 because of rise in wheat prices.

Inflation in wheat rose to 4.74% last month while price rise was only 2% in February, 2024 from 12% in July,2023 on year because of improvement in supplies due to open market sale being carried out by the Food Corporation of India. The corporation has sold a record 9.6 MT wheat in the open market through weekly e-auction this fiscal.

Retail rice prices rose by 12.69% last month, marginally higher from the previous month. The government has banned exports of white rice and imposed 20% export duties on par-boiled rice to improve domestic supplies.

Inflation in the meat and fish category rose by 6.36% last month, while the rise in prices in February, 2024 was 5.24% on year. Chicken prices rose by 8.53% last month because of higher feed prices, while prices rose by 5.69% in February, 2024 on year.