Despite the fall in wholesale market prices, the retail price of pulses remains high
28-Feb-2025 06:17 PM
The situation you're describing highlights a significant disconnect between wholesale and retail prices for pulses in India, particularly for gram and tur dal, despite a sharp fall in wholesale prices over the past two months.
Key Points:
Wholesale Price Drop: The wholesale prices of gram and tur have fallen by around 25% in the last two months, even dipping below the minimum support price (MSP) in some regions.
Retail Prices Still High: However, retail prices remain high. For example, the retail price of gram dal has decreased by only 4.3% and tur dal by 12%. This has left consumers not benefiting significantly from the price reductions seen in wholesale markets.
Factors Contributing to Price Fall:
- Increased Imports: There has been a significant increase in the import of duty-free pulses, such as yellow peas and Desi gram, contributing to greater supply in the domestic market.
- Domestic Harvest: The arrival of new domestic crops has added to the supply, especially of gram and tur.
Mismatched Price Effect: Despite the drop in wholesale prices, the retail market has not responded in kind. Even though the wholesale price of lentils and moong has decreased by 10-15%, retail prices have only dropped by around 1%. This shows a lag in price adjustments at the consumer level.
Inflation in Retail Prices: The reasons behind the disparity could involve factors like middlemen in the supply chain, who may be holding onto inventory or taking longer to adjust prices. Additionally, regional variations and local demand and supply dynamics may influence retail pricing more than wholesale movements.
Impact on Consumers: As a result of this lag in price adjustments, the average consumer is not seeing the benefits of falling wholesale prices in their grocery bills. In fact, the prices remain relatively high for staples like dal, making it harder for the general public to afford these essentials.
Market Expectations: While the All India Dal Millers Association anticipates that imports of tur will continue, potentially leading to a further softening of prices, it remains unclear when or if the retail market will reflect these changes more transparently.
The disconnect between wholesale and retail prices for pulses is a significant issue. It raises questions about the efficiency of the supply chain, and how quickly reductions in prices at the wholesale level can trickle down to consumers in the retail market.