The Hindu Business Line : Prices of pulses begin to soar on Myanmar unrest

Chennai, Oct. 3 Prices of pulses, including chana and tur, have begun to spurt following the civil unrest in Myanmar; and they could increase another two to five per cent this month.

The prices began to gain ground ever since civilians began to protest the junta rule around September 26. Chana spot prices have gained nearly two per cent since then to Rs 2,250 on Wednesday. Tur is one which has seen its price gain nearly 10 per cent during the period, while urad has gained over one per cent. (See Table)

Chana contracts have gained in the futures market too. On the multi-commodity exchanges, only chana contracts are allowed, while those of tur and urad are barred. The ban was imposed last year when prices of these pulses soared on fall in production.

Chana October contracts on NCDEX during the period of unrest have increased to Rs 2,321 a quintal from Rs 2,287, while November to Rs 2,326 (Rs 2,290) and December to Rs 2,287 (Rs 2,251). On MCX, the contracts have increased to Rs 2,296 (Rs 2,271), Rs 2,316 (Rs 2,285) and Rs 2,291 (Rs 2,256) respectively.

Loading halt

“Loading of ships in Myanmar has come to a halt due to the unrest. As a result, deliveries of pulses such as urad and tur will be lower this month. This has helped prices to gain,” said Mr K.C. Bhartiya, President of Pulses Importers Association.

According to sources, it will take at least 12 to 14 days before loading begins in Yangon port. “The Yangon port in Myanmar is a small one and not many ships call on there. Therefore, there will be a clear two-week delay in shipments as of now,” they said.

Analysts say chana is gaining only on the general trend that is being witnessed in the pulses market. “The quantum of imports of chana from Myanmar is too insignificant, hence happenings there will not have a direct impact on prices.

“India being a large importer of urad and tur from Myanmar, there could be some delay in imports. This delay could indirectly keep domestic urad and tur prices firm, which in turn could keep chana well supported due to sentiments,” said Ms Akshita Bhatt, research analysts of Kotak Commodity Services Ltd.

According to a note from Sharekhan, chana prices took a sharp leap on the higher side early this week as the political situation in Myanmar remained tense. Since it is one of India’s biggest sources of imported pulses, supply disruption could lead to similar problems in the domestic markets.

Festival offsets

Sources said the rise was also in view of the ongoing festive season. “Mills need stocks and we need to have enough rolling stocks. Now, rolling stocks are a little less and that’s why we see the surge in prices,” they said.

But Mr Bhartiya said there was no shortage of any pulses in the country. “Because of the Myanmar factor, prices will gain by two to five per cent this month,” he said.

Analysts and importers are unanimous in their view that the surge in prices will be short-lived. “The price rise may be confined only to tur and urad,” said Mr Bhartiya.

Sources said the Centre was not helping anyone’s cause by selling pulses in small lots of 200 tonnes “like a small trader”.

Kharif pulses

Meanwhile, kharif pulses crop is reported to be good and prices of crops such as urad and tur could soon witness a drop. Chana is a rabi crop and whatever is available in the market is from the previous year’s stocks. Imports are expected from November onwards when the Australian crop arrives in the market.

“Crops such as urad and tur are pretty good. There are no reports of any damage to the crop due to weather factors. Arrivals will begin soon,” Mr Bhartiya said.