Edible oil, chicken rates push SPI back up 1.1pc

KARACHI: Spike in prices of chicken and edible oil and ghee made weekly inflation jump up 1.1 per cent week-on-week and 15.67 per cent year-on-year during the seven-day period ended March 24, dashing all hopes of some stability among the middle and lower middle income groups of the country.

Pakistan Bureau of Statistics (PBS) data attributed the increase to rising prices of chicken (8.47 per cent), vegetable ghee 2.5kg and 1 kg (4.59 and 1.12 per cent), bananas (4.04 per cent), cooking oil (2.55 per cent), potatoes (1.56 per cent), curd (1.02 per cent), lawn (1.17 per cent), and shirting (1.03 per cent). The commodities had a joint impact of 0.91 per cent in overall SPI for the combined group.

Chicken prices increased on the back of a spike in the cost of poultry feed as well as a rise in demand for the commodity due to curb on meat sellers for stopping the spread of lumpy skin disease in cattle. During the week under review, a kilo of chicken was sold for Rs302.08 on average, up Rs23.59 from last week’s Rs278.49/kg. The Pakistan Poultry Association (PPA) had demanded a subsidy on poultry inputs as well as a ban on corn exports from Pakistan last week. Also the PPA demanded withdrawal of 17 per cent tax on soybean, which a mainstay in poultry feed.

Analyst Fahad Rauf of Ismail Iqbal Securities in his note said chicken prices increased as poultry feed prices continued to rise. Along with this, prices of cooking oil have also increased due to incessant uptick in international palm oil prices. “We estimate March 2022 CPI to come at 12.1 per cent versus 12.2 per cent in February 2022,” he added.

Last week SPI numbers had declined 1.37 percent on the back of electricity tariff relief under the prime minister’s relief package; however, the downward momentum could not be maintained.

Former federal finance minister Miftah Ismail in a thread on “PTI’s economy” said that high inflation numbers in February “are the result of PTI’s incompetence and corruption (wheat, medicines, sugar, fertiliser, etc). Pak has the 3rd highest inflation in major economies”.

Cornered by the opposition’s agitation tactics, on February 28, Prime Minister Imran Khan had announced the slashing of petroleum products’ price by Rs10/litre and electricity tariff by Rs5/unit to give some relief to the public. However, those relief measures failed to keep the prices of daily use items in check for long.

PBS computes SPI inflation on a weekly basis to gauge the price movement of essential commodities at a shorter interval of time so as to review the price situation in the country. It comprises 51 essential items and the prices are collected from 50 markets in 17 cities of the country.

During the week, out of 51 items, prices of 25 items increased, eight items decreased, whereas prices of 18 items remained unchanged. SPI was recorded at 170.92 points against 169.06 points registered previously.