Prices of cereals are unlikely to rise further as witnessed in the recent past but may remain elevated well into the next fiscal due to vagaries of climate change, strong global and domestic demand, rating agency Crisil said.
Domestic production of cereals has grown consistently in the past 50 years. However, prices of cereals have risen faster. The weighted average crop price index for cereal crops logged 3-4 per cent CAGR (Compounded Annual Growth Rate) over fiscals 2017-2022, it said in a report.
Even in the current fiscal, prices of cereals have risen significantly on-year in the first nine months -- of wheat and paddy by 8-11 per cent and of maize, jowar and bajra by 27-31 per cent, it added.
"....the price sentiment for cereal crops is expected to be strong in absolute terms," Crisil said.
Anticipation of higher production of wheat in current rabi season is expected to improve the stock condition, which may put downward pressure on prices, though heatwaves remain a key monitorable, it said.
For kharif crops such as paddy, maize, and millets, the production expectations would be positive if normal, well-spread monsoon prevails.
Quaker Oats enters fast-growing ready-to-eat cereals with Muesli oats
Punjab & Sind Bank's asset quality deterioration to moderate: CRISIL
Crisil Sept-quarter net profit jumps 31% to Rs 148 cr, income up 23.9%
OEMs to drive 16-18% rise in auto-parts MSME revenues: CRISIL SME Tracker
Price cap on Russian oil to benefit mkts, constrain Putin's finances: US
NIA files 2nd additional chargesheet in Mundra Port narcotics seizure case
Delhi riots: SC refuses to interfere in AAP leader Tahir Hussain's case
Delhi L-G approves medical boards to deal with surrogacy-related issues
Women's T20 World Cup: Matthews credits WI fielding for win against Pak
Gap between civilians, security forces reducing in Kashmir: SSB official
"However, prediction of higher chances of El Nino impact on south-west monsoon by the National Oceanic and Atmospheric Administration would be a major monitorable as El Nino had resulted in 14 per cent lower rainfall and a 2-3 per cent lower kharif cereal production during 2015," the report added.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)