The cost of a home-cooked vegetarian thali rose 10% year-on-year in September, while a non-vegetarian thali became 6% more expensive, as higher onion, edible oil, rice and LPG prices pushed up costs of household food, according to Crisil Intelligence.
The cost of a vegetarian thali rose to ₹30.8 in September from ₹28.1 a year earlier, while the non-vegetarian thali increased to ₹59.5 from ₹56, the monthly Roti Rice Rate (RRR) indicator showed.
“The cost of home-cooked vegetarian (veg) and non-vegetarian (non-veg) thalis rose 10% and 6% on-year, respectively, in September, with food costs remaining elevated amid tightening supplies of key staples and higher input costs,” said Crisil Intelligence director Pushan Sharma.
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On a monthly basis, the vegetarian thali became 4% costlier in September, while the non-vegetarian thali rose 3%. Onion was a major driver, with prices jumping 89% on-year to ₹53 a kg from ₹28 a year earlier.
Crisil attributed the onion price surge to tight rabi stocks and a 5-6% decline in production. June rainfall was 40% below the long-period average, delaying kharif transplanting and fresh arrivals. Seasonal festive demand is expected to add to the pressure in the first half of October.
{{/usCountry}}Crisil attributed the onion price surge to tight rabi stocks and a 5-6% decline in production. June rainfall was 40% below the long-period average, delaying kharif transplanting and fresh arrivals. Seasonal festive demand is expected to add to the pressure in the first half of October.
{{/usCountry}}“The near-term outlook remains firm, as seasonal supply constraints are likely to keep food costs under pressure. Onion prices could remain elevated in the first half of October owing to delayed kharif arrivals, before easing gradually towards the end of October as fresh kharif arrivals improve market availability,” Sharma said.
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Tomato prices could also firm up on delayed kharif arrivals and seasonal demand, while potato prices may come under upward pressure as higher-priced cold-storage stocks are increasingly liquidated, he said.
Pulses remain another key monitorable, particularly tur, amid weather-related production risks. Tur and Bengal gram are harvested from January, leaving the market relatively dependent on imports during the pre-harvest period. Tur imports attract zero duty, while Bengal gram imports face a 10% duty.
“Prices typically remain firm during October-November due to seasonal tightness,” Sharma said.
Rice and edible oil are also expected to keep food costs elevated. Prices of rice rose 8% on-year in September, with Crisil expecting paddy production to decline 5-6% because of lower acreage and weaker yields. Steady domestic consumption and export demand are likely to provide further support.
Vegetable oil prices rose 12% on-year despite a reduction in the basic customs duty on crude palm oil, while LPG prices remained 10% higher amid global supply disruptions.
“While the reduction in the basic customs duty on crude palm oil from 10% to 5% in late September is expected to lower landed costs by around 5%, robust festive-season demand is likely to keep prices elevated,” Sharma said.
Vegetable oil prices are consequently expected to rise around 10% on-year in October, although at a slower pace than currently, he added.
The non-vegetarian thali saw a relatively smaller increase because broiler prices, which account for about half its cost, rose only 2% on-year. Lower chick placements, monsoon-related supply disruptions and higher maize prices affected broiler supplies.
“Overall, while fresh crop arrivals should provide some relief later in the season, tight inventories, weather-related risks and firm global commodity prices are likely to keep thali costs elevated in the near term,” Sharma said.