Edible oil prices rose by 39% in a year, the rapidly declining retail inflation rate may again be derailed

Edible oil prices are once again rising rapidly. Their prices have increased by 39% in a year. If this trend continues, then the retail inflation rate, which has been declining rapidly for the last three months, may again be derailed. This may also be a setback to RBI's plan to boost growth and cut the repo rate. According to the Ministry of Consumer Affairs data, the price of groundnut oil was Rs 190 per liter on February 14, 2024, which has now crossed Rs 192 per liter. The price of mustard oil has increased from Rs 136 to Rs 169 per liter during this period. That is, there has been an increase of 24%. The price of vegetable oil has increased by 21% to Rs 151 per liter, which was being sold at Rs 125 per liter a year ago.

Figures show that soya oil has also risen by 19%. Its price has risen from Rs 122 to Rs 145 for every liter. There has been an increase of 27% in sunflower oil. Its price has risen from Rs 123 to Rs 156 for every liter. There has been the largest increase of 39% in palm oil. Last year its price was at Rs 99 for every liter but has now gone over Rs 137.

The increase in the price of palm oil affects daily utility commodities. FMCG companies manufacture their commodities like soap, shampoo, etc., on a mass level by using palm oil. Then, these commodities' inflation level is higher as their price has gone up. Recently, FMCG companies have raised their commodities' prices to a high level.

Potatoes and onions have also appreciated in price in the last year. Other vegetables at the moment are fairly low in cost. Potato was priced at Rs 22 per kg last year but now is at over Rs 25 per kg. Similarly, onions have appreciated from Rs 32 to Rs 36 per kg. Prices of these in retail markets are even higher than that.

On the other hand, the price of tomatoes has now come down to Rs 3 per kg in wholesale. The situation is such that due to such low prices, farmers are not even able to recover their costs. Due to this, they are leaving tomatoes in the fields. However, in the retail market, it is still being sold at Rs 20-25 per kg. Tomato farmers in Chhattisgarh, Madhya Pradesh, and Maharashtra are incurring huge losses. Tomato is produced and exported on a large scale in the Durg, Jashpur, Mahasamund, Mungeli, and Balod districts of Chhattisgarh. Here tomatoes are being sold at Rs 2 in wholesale and Rs 5 in retail.

Businessmen of Chhattisgarh say that tomatoes from here used to go to Maharashtra, Bengal, and other states, but this year tomato production has been good in other states. Apart from this, earlier tomatoes from the state used to go to Pakistan, Bangladesh, Nepal, and other neighboring countries. For the past few years, supply to other countries except Nepal has stopped.