Customers were somewhat relieved when onion and tomato prices dropped in January. According to a recent Crisil study, food costs fell throughout the month as a result of monthly drops in the prices of tomatoes and onions of 26% and 16%, respectively.
Crisil stated that the reason for the easing was a drop in tomato and onion prices of 16% and 26% month over month, respectively, as well as increased domestic supply of onions due to export restrictions and fresh tomato shipments from the northern and eastern states. On the other hand, the report pointed out that over the last year, the cost of a vegetarian thali has increased by 5%, while the cost of a non-vegetarian thali has decreased by 13%.
According to Crisil's Roti Rice Rate (RRR) research, in January 2024, a vegetarian thali consisting of roti, onion, tomato, and potato along with rice, dal, curd, and salad will cost Rs 28. In January 2023, the cost of the same thali was Rs 26.60.
For 52 rupees, one can purchase a non-vegetarian thali that includes rice, chicken (broiler), salad, curd, onion, tomato and potato. That was on sale for Rs 59.9 at the same time.
"The cost of the non-veg thali declined faster due to a decline of 8-10 per cent on-month in prices of broilers," the report stated. In December 2023, a vegetarian thali cost Rs 29.7.
According to Crisil, "the price of the vegetable thali went up because of a 35% and 20% year-over-year increase in onion and tomato prices, respectively."
As per the survey, the increased costs of home-cooked vegetarian meals in January compared to the previous year were also caused by higher prices for rice and pulses from the prior year. Noteworthy, food inflation was reported at 9.53 percent in December while retail inflation was 5.69 percent. In January 2023, on the other hand, retail inflation was reported at 5.52% and food inflation at 5.94 percent.
After July and August, December had the greatest monthly retail inflation during the April–December 2023 period. July's 7.4% inflation rate was the highest in 15 months, mostly caused by a steep increase in the cost of vegetables and other food staples like cereals, pulses, and spices.
The Centre has implemented a number of policies to control food inflation in recent months, including importing pulses and lowering the price of onion stocks, according to Finance Minister Nirmala Sitharaman's statement on Tuesday.
Speaking in the Rajya Sabha, FM Sitharaman stated that through the National Cooperative Consumers' Federation of India Ltd (NCCF), NAFED, Kendriya Bhandar, and other state-controlled cooperatives, the government has prepared stocks to release onions at a subsidized rate of Rs 25 per kilogramme to stop the rising price of onions.
She continued: "As of 3 February 2024, we have released 3.96 lakh tonnes of onions in the market at that price."
The consumer food price index, which measures inflation in the food industry, increased to 9.53% in December. This represents a significant increase over the 8.70% recorded in November and above the 6.61% recorded in October and the 6.62% recorded in September.
According to a January research report by Crisil, which looked at Google search trends for the costs of tomatoes, onions, and potatoes (TOP), Indians may have become less anxious about inflation throughout December and January, particularly in light of the increases in food prices.
According to Crisil economists, concerns regarding price increases may have subsided since December as prices for onions and tomatoes have decreased. However, the total Google Trends Index value, which is based on inflation-related searches, was still higher than it was between 2018 and 2021, suggesting that worry levels are still high.
Although concerns about inflation are lessening, if price pressures continue, high and unstable food prices may cause concerns about inflation to increase again. The economists said in a paper titled "An unlikely gauge of price angst" that "cooling of non-food inflation and easing of inflation anxiety about TOP prices has brought some relief at the end of the calendar year."
