Food price stable in harvesting season

Food prices remained stable in October due to the harvesting season of the major cereal crop – rice – in the country.
The market price of the Ministry of Agriculture Development and World Food Programme (WFP) showed that the price of major food items either slightly declined or remained stable in October.

The price of coarse rice went down by four per cent to Rs 35.5 a kg, while that of wheat flour marginally increased by 0.4 per cent to Rs 37.8 per kg. The price of pulses such as black gram and broken lentil slightly increased by 2.2 per cent and 1.2 per cent, respectively, while the price of potato decreased by 3.8 per cent due to an increase in supply.

Compared to July 2012 and October 2011, however, prices mostly indicated an upward trend.

Food prices in the regional markets showed a mixed trend in October. After a continuous increase over the last three months, the price of coarse rice declined in the major consumer markets. Likewise, its price marginally declined in Terai markets, as compared to last month, whereas it remained stable in the hill and mountain markets with road access. The price of wheat flour, which is the main staple food in Terai, increased due to a higher demand during the festive season.

In the five large wholesale markets — Birtamode, Kathmandu, Butwal, Surkhet and Dhangadi — most wholesale prices showed an upward trend over the past one month.

In the Kalimati Fruits and Vegetables Market, the wholesale price of off-season vegetables such as carrot, bitter gourd and cucumber increased by more than 15 per cent, while that of seasonal vegetables such as cauliflower and cabbages declined by more than 10 per cent. The wholesale price of apples and oranges climbed up by more than 10 per cent due to a higher demand during the festivals.

The year-on-year inflation, released by the central bank in September, increased by 11.2 per cent as compared to 8.5 per cent over the same period last year. The price index of food and beverages group increased by 10.4 per cent as compared to an increase of 10.2 per cent in the corresponding period last year, while that of cereal grains increased by 7.2 per cent as compared to 0.6 per cent over the same period last year. The price index of transport also increased by 15.2 per cent as compared to an increase of 12.7 per cent in the same period last year.

As the harvest of summer crops has already started in the hills, food demand will likely decrease, thereby keeping prices of staple foods low. The price of lean season vegetables such as bitter gourd is likely to increase and that of seasonal vegetables such as cauliflower and cabbage is likely to decline in the coming months.