The inflation based on Wholesale Price Index (WPI), for the month of January 2017, has moved above the Consumer Price Index (CPI) after their convergence in December 2016. In January, WPI was 5.25 per cent and CPI stood at 3.17 per cent. The sharp spike in WPI was due to increase in fuel prices of high-speed diesel and petrol of 31 and 15.6 per cent, respectively. The decline in CPI since November 2016 is due to drop in prices of food articles, mainly pulses and vegetables. In January, vegetable prices in CPI were down 15.6 per cent.

Record foodgrains output

Good monsoon after two years of drought in India is likely to help in foodgrains output, which is set at a record 271.98 million tonnes for the 2016-17 crop year ending June, compared to last year. According to the Agriculture Ministry’s second advance estimate, rice, wheat, pulses and oil seed are set to surpass previous records. Sugarcane production, however, is estimated to be lower at 10.06 million bales for the current year compared to 10.52 million bales last year.

Vegetable oil import falls 19% in Jan

Vegetable oil imports declined by 19 per cent to 1.02 million tonnes for January 2017 compared to the same month last year. The overall import of vegetable oil also declined during the first three months of oil year (November 2016-January 2017) by 15 per cent, year-on-year. The drop is attributed to good kharif crop leading to better domestic availability of edible oils. Also, currency crunch due to demonetisation has affected the purchases and the imports.

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