UAE: 5 reasons why grocery prices will fall further even as world fights inflation – News

Retailers are not allowed to raise prices on 9 basic food items under recent government directive

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Food prices in the UAE are expected to fall further in the coming months due to lower freight rates, regular and uninterrupted supplies of essential consumer goods for UAE importers, strengthening of the UAE dirham and into the new market opportunity.

UAE retailers have lauded the pro-market and pro-consumer policies adopted by the authorities to control prices of goods. A new policy was introduced last week that retailers are prohibited from raising prices on nine basic consumer goods, including cooking oil, eggs, dairy products, rice, sugar, poultry, beans, bread and wheat. The UAE government said this was a preliminary list and more items could be added.

Earlier this year, the UAE approved a new policy under which suppliers must submit evidence of price increases for basic commodities such as milk, chicken, eggs, bread, flour, sugar, salt, rice, cooking oil, mineral water, etc. is reasonable.

Runaway inflation in the U.S. and elsewhere has prompted central banks to raise interest rates to curb inflation.

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Dr Dhananjay Datar, chairman and managing director of Al Adil Trading, said the UAE’s decision to control prices of nine basic commodities will benefit consumers as prices of some commodities are rising due to wheat and sugar bans in India.

Dr. Dhananjay Datar

However, prices for most other commodities are falling as freight rates fall from $1,150 to $190 per 20-foot container, he said.

“The currencies of many countries, which are the main source markets for UAE importers, have fallen against the dirham. Also, wheat imports from Ukraine have also started and prices will fall in the coming months due to new supplies and lower freight rates. Therefore , which is also good for UAE consumers and will lead to a price drop of around 10% to 15% in the coming months,” Dr Datar added.

The U.A.E. dirham, which is pegged to the dollar, rose against many emerging-market currencies, making imports cheaper for local traders and importers.

The chairman of Al Adil Trading added that the UAE now buys sugar from Europe and Brazil, while local sugar companies are also producing sugar on a large scale, so prices in the UAE are stable.

“Globally, the new staple commodity crops are doing well around the world and new supplies will hit the market in January-February. So that will also have a good impact on prices for consumers,” he added.

Al Maya Group group director Kamal Vachani said they followed the guidelines and instructions of the authorities regarding commodity prices in the country.

Kamal Vachani

Vachani added that prices of basic commodities are stable and will remain so.

“The UAE has kept prices stable because the government has a very pragmatic approach and they also look at prices from a consumer point of view. The government ensures that residents get the best prices and they should not be saddled with high interest rates. The latest price control move is in that direction developed,” he said.