UAE: Why you might notice price hikes on some common groceries – News

Uptrend likely to continue for rest of year, retailers say

Grocery prices for certain consumer goods such as chilli, black pepper, lentils and sugar are rising as India’s harvest is smaller than expected.

The upward trend is likely to continue for the rest of the year, retailers say.

“The prices of some commonly used spices, such as [chillies], cumin, turmeric, seeds and black pepper rose due to crop failure in India. Also, the price of sugar and different types of lentils has also increased,” said Dr Dhananjay Datar, chairman and managing director of Al Adil Trading, one of the leading importers of spices and other staple food products in India.

“During the rest of the year, prices are likely to rise further due to shortages of these items. This is only due to a lower-than-expected harvest, as other key aspects such as transport costs and currency remain the same,” he said.

Lentil prices have also risen in India due to a shortage in the domestic market, with the world’s fifth-largest country looking to import from other countries in the Asian region. Many parts of the South Asian country are also facing drought.

Al Adil Trading currently operates more than 50 outlets in the UAE, mainly in Dubai and the North of the UAE.

Emirates NBD Research expects headline inflation in the UAE to average 3.5% this year and 4.8% in 2022. Inflation in Dubai slowed to a 14-month low of 3.3% in April from 4.3% in March.

Entertainment and culture prices rose 3.2% in April, followed by education (1.1%) and food (1.1%) in Dubai.

“We expect inflation to moderate in the UAE this year, as last year’s surge in food and energy prices is now at the bottom, and prices for these commodities have eased in recent months. However, housing inflation in the CPI is expected to move higher in 2023, ’ it said.

India is one of the largest source markets for staple foods for UAE importers. Bilateral trade has grown to $45.5 billion (AED167 billion) since the signing of the Comprehensive Economic Partnership Agreement (Cepa) last year.

Dr Dhananjay Datar said traders want to source these consumer goods mainly from India as they can import in large quantities.

“However, the price of goods imported from India could rise by another 30 percent,” Dr Datar added.