Indicus Prime Monitor (IPMP) picked the uptrend in inflation before the Wholesale Price Index (WPI) in August last year. Over last 12 months, inflation in the WPI has been well above 20% and is currently poised around 30%. Sowing for the rabi crop was up by 0.7 lakh hectares in the first week of January compared to last year, yet with low total output, the price spiral is not set to turn downward.

Groundnut prices have been rising since March 2009 and consequently the retail price of packed groundnut oil has risen from an average of Rs.82 per kg in 2009 to Rs.124 in 2012. Even as there has been a shortfall in output, exports have been increasing and the DGFT has recently set new rules for its exports. Such restrictions may make for larger than expected domestic supplies, giving a cap to any large rise in prices.

IPM data till week ending 12th January 2013. The Indicus Price Monitor, a product of Indicus Analytics Pvt Ltd, tracks realtime wholesale prices for 62 agricultural products from more than 3000 mandis. Due to differences in methodology, the actual levels of the IPM differ from the corresponding WPI, however broad trends are in sync.