Despite a record output in 2010-11, low imports from Australia and Tanzania led to prices rising steadily from November 2010. Domestic production fell in 2011-12, leading to further pressure till September 2012. It is only recently that prices have moderated as cheap imported gram arrived. All-India average wholesale price touched Rs.6,239.06 a quintal at peak and in January the price has averaged Rs.5,810.98. Retail price at Rs.62.68 a kg is significantly higher than Rs.49.19 a kg last January. Inflation has been extremely high, above 20 per cent, since August 2011.

The rabi crop’s sowing is higher by 0.47 million hectares by January 11th, against last year’s, as farmers are taking advantage of the high prices. Also, significantly larger imports from Australia are expected this year, which can bring down prices. A cold wave in Madhya Pradesh, the chief producer in India, can cap any large drop in prices in the near term.

IPM data till week ending January 19. The Indicus Price Monitor, a product of Indicus Analytics Pvt Ltd, tracks realtime wholesale prices for 62 agricultural products from more than 3,000 mandis. Due to differences in methodology, IPM levels differ from the corresponding WPI. However, broad trends are in sync.