AFTER having softened during the last couple of weeks, prices of essential items again resumed upward drive last week and tended further higher amid light trading.

Although essential items rose in unison, pluses, rice and sugar showed sharp increase followed by reports of short supply and hoarding by leading stockists. Price flare-up between Rs300 and Rs400 in most of the items was a common feature.

Physical business was, however, on the lower side of the weekly average as consumers did not make fresh buying anticipating fall in prices after the supply position improved.

Market sources said permission by the government to relevant agencies to conduct raids on retail outlets to check increase in prices of essential items was expected to produce the desired results. Impact of this move would be known possibly by the next week.

Dealers attributed the price flare-up partly to fall in arrivals from upcountry and partly to reports of hoarding by some local commercial traders. Pulses, which had been dormant for the last couple of weeks, were firmly held at the last levels.

Floor brokers said some recent steps of the State Bank including in import trade to shore up the rupee against the US dollar may have caused renewed price flare-up on this sector.

Some others said the central corrective steps, which may not affect the already confirmed Letters of Credit and some of the consignments may be on their way on the open seas, the current price flare-up appeared to be anticipatory and speculative.

Price flare-up was widespread and covered the entire list of essentials, but the biggest rise of Rs200 to Rs400 per bag was recorded in some varieties of pulses.

Sugar followed them though the increase was modest amid fears of shortage of the commodity owing to higher exports and reports of hoarding by speculators, market sources said.

Unlike previous weeks, wheat, which did not follow market’s general line of action and fell modestly after supply position improved, also rose. Permission to private sector to import wheat to export flour to Afghanistan failed to check fresh increase in prices, they added.

The market advance was led by the pulses sector as almost all varieties were quoted higher by Rs150 to Rs500 per bag, sharpest rise being in masoor and gram dal.

Sugar followed them as its price rose by Rs250 to Rs300 per bag after reports of larger export and pressure on local supplies. Gur followed it, and was quoted lower by Rs100 but on the other hand desi sugar did not show any change.

Wheat rose to new peak level of Rs2,415 per bag, up by Rs75 over the week despite reports of comfortable supply position and fresh imports.

Cereals, which had been ruling around previous levels, also rose by Rs50 to Rs100 for jowar and maize respectively and so did some others, which was also quoted higher by Rs100. Bajra, however, did not show any change.

Among major industrial raw materials, guar seeds were quoted higher by Rs200 per bag on reports of slow arrivals from upcountry market and active demand by processors.

Major oilseeds, mainly rapeseed, also came in for active support after remaining dormant for the last couple of weeks and rose by Rs100 to Rs200 per 40 kg, on the other hand cottonseed were marked down by Rs50 to Rs100 on selling prompted by new crop arrivals. Cotton did not show any change over the week.

Among other seeds, castor seed was quoted higher by Rs25, but the largest increase was in til which shot up by Rs700 on revival of export demand and pressure on local supplies.

Oilcakes rose by Rs25 to Rs35 for rapeseed cakes, on the other hand cottonseed cakes were marked down by Rs30 in sympathy with cottonseed.