Declining trend in commodity prices
Commodity prices which were sky rocketing due to supply constraints
have begun declining. Director Price and Wages of the Department of
Census and Statistics (DCS) D.C.A. Gunawardena said that vegetable
prices slightly declined last week. He said that prices of items such as
red onions have declined with supplies reaching from Jaffna. The DCS
regularly monitors consumer prices in Colombo markets.
The wholesale price of many
commodities declined with imports from India which arrived
at the Pettah market
Meanwhile inflation figures for February reflect the impact of high
commodity prices that prevailed last month.
Annual average inflation, for February as per the Colombo Consumer
Price Index (CCPI) (2002=100), increased to 6.1 percent in February from
6.0 percent in January. Year-on-year basis, inflation increased to 7.8
However, the core inflation, both in terms of year-on-year and annual
average bases decelerated further to 2.9 percent and 5.5 percent, in
February 2011 compared to 3.6 percent and 6.06 percent in January,
according to the Central Bank. This reflects the stability in the
general price level because in calculating core inflation it excludes
certain items that face volatile price movements.
Increase in inflation is mainly due to the increase in prices of most
varieties of vegetables, coconut, coconut oil, red onions and rice, the
Central Bank said. However, the price of many commodities showed a
declining trend last week.
Wholesellers of the Pettah market said that the wholesale price of
many commodities have declined compared to the previous week. Red and
white Kekulu rice declined from Rs.58-59 to Rs.54-55 last week.
The wholesale price of Samba No.1 was Rs.69, Samba No.2 Rs.68, Samba
Kekulu (White) No.1 Rs.69, Red Samba Rs.69, Red Nadu Rs.59, Keeri Samba
No.1 Rs.98 and Keeri Samba No.2 Rs.95.
Big onion and red onion prices too have declined with imports from
India being restored. The wholesale price of Indian big onions was
recorded at Rs.95/kg while Pakistani big onions was sold at Rs.75/kg.
Red onions and chilie imports from India too have been instrumental in
bringing down market prices.
The price of red onions which was over Rs.400/kg a week ago has
declined sharply. The wholesale price of Indian red onions was Rs.95-100
last week and the supply from Jaffna was Rs.80/kg, traders said.
Traders said that the main reason for decline in prices is that India
has relaxed export restrictions on food items.
They said that rice prices have declined with Maha season harvesting
and this trend will be temporary. Prices will increase again by mid
March unless the government allows rice imports.