The Hindu Business Line : Urad prices gain on Myanmar cyclone effect

Nature’s fury
Urad prices have increased to Rs 2,450-2,500 a quintal from Rs 2,350-2,400 for the fair average quality.
Prices may stabilise around this level as stocks in the country can last for over two months.

M.R. Subramani

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Chennai, May 7 Urad (black matpe) prices have increased by Rs 100 a quintal this week following the havoc wreaked by Cyclone Nargis in Myanmar, which is the main supplier of pulses to the country.

The market is concerned about delay in shipments even as full picture of damage to agricultural crops, including rice and pulses, is yet to emerge on the tragedy that is believed to have taken a toll of more than 22,000 lives.

Urad prices have increased to Rs 2,450-2,500 a quintal from Rs 2,350-2,400 for the fair average quality before the cyclone struck the Irrawady delta in which three out of every four houses has been flattened. Superior quality urad prices have increased by similar margin to Rs 2,750 a quintal.

“The immediate reason for prices to rise even as we are getting bare details is that no shipments will take place for the next 20-25 days from Myanmar,” said an importer source.

Though there is no danger to the urad crop in that country since the harvest got over well before the tragedy struck, the trade is worried about stocks kept in warehouses.

“There has been no word on the stocks in the warehouses as also the produce which farmers may have kept with them in the Irrawady basin,” said Mr P. Krishnamurthy of South Indian Pulses Importers’ Association.

Importers buy mainly through traders in Singapore, who are also in the dark about the real situation. However, some of them have begun to seek extension for fulfilling their contracts. “There is no way but to give them more time,” said Mr Krishnamurthy.

Myanmar exports 7-10 lakh tonnes of pulses to India with urad, tur and green gram being the main commodities. During April-September 2007, pulses imports into the country nearly doubled in value to Rs 24,213 crore (quantity 12.78 lakh tonnes) compared with Rs 12,910 crore (quantity 8.04 lakh tonnes) during the same period a year ago.

The other pulses have not shown the same tendency to rise in view of the arrivals of the rabi crop. As such, the rabi urad crop was damaged in Tamil Nadu and Andhra Pradesh due to untimely rains in February and March. These two States produce about 3.25 lakh tonnes of rabi urad.

“However, we expect the prices to stabilise at this level. This is because traders, in general, have adopted to go in for hand-to-mouth existence in view of the stock limit orders being imposed by various State Governments,” said Mr Krishnamurthy.

Though the arrivals of imported pulses are likely to be delayed by at least three weeks, there are adequate stocks of the pulses within the country.

The importer source said stocks of pulses in the country could last for another two-and-a-half months.

They said prices could go up in the medium-term for pulses. “This is because prices of essential items in Myanmar have sky-rocketed. When the local prices there rise, there will be consequent increase in export prices,” the sources said.

More Stories on : Pulses | Commodity Markets

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