The Cost of Homecooked Vegetarian Thali Declines in August
The cost of a homecooked vegetarian thali in India saw a significant decline in August 2024 compared to the previous months. This decrease was primarily driven by a drop in prices for key ingredients like tomatoes, vegetable oil, and spices.
According to Crisil's Roti Rice Rate index, the price of vegetarian thalis dropped by 8% year-on-year (Y-o-Y), while non-vegetarian thalis saw an even sharper decline of 12% Y-o-Y.
Reduced Tomato Prices: Fresh arrivals from southern and western states led to a 51% on-year decline in tomato prices, which account for approximately 14% of the veg thali cost.
A 27% drop in fuel costs contributed to the decline.
Prices of vegetable oil, chilli, and cumin, which together account for less than 5% of the veg thali cost, eased by 6%, 30%, and 58% on-year, respectively.
The cost of non-veg thali saw a sharper decline due to an estimated 13% on-year drop in broiler prices, which account for approximately 50% of the cost.
From July to August 2024, the costs for both veg and non-veg thalis decreased. The veg thali saw a decline of 4%, while the non-veg thali declined by 3%. This reduction was mainly due to a significant drop in tomato prices and a decrease in broiler prices during the Shravan month.
The decrease in thali costs comes as a relief for households across India, particularly amidst concerns about food inflation.
India has seen a positive trend in food inflation due to good harvests following monsoon rains. Retail inflation dropped to a near five-year low of 3.54% in July, with food inflation decreasing to 5.42% from 9.36% in June.
These developments indicate a positive outlook for India's inflation scenario moving forward. However, RBI Governor Shaktikanta Das cautioned that volatile food inflation could still impact the pace of disinflation.