Veg thali cost drops 8% in August, driven by low tomato prices: Crisil | Economy & Policy News

The cost of preparing a thali at home witnessed a notable decline in August 2024, both on a yearly and monthly basis, according to Crisil’s latest Market Intelligence & Analytics (MI&A) Research. Crisil’s Roti Rice Rate index showed the price of vegetarian (veg) thalis dropped by 8 per cent year-on-year (Y-o-Y), while non-vegetarian (non-veg) thalis saw an even sharper decline of 12 per cent Y-o-Y.

 

This drop was mainly driven by significant price reductions in home food essentials, primarily tomatoes, vegetable oil, and spices. Lower fuel costs and broiler prices also contributed to the lower expenses.

Key drivers behind lower thali costs:

Tomato prices: Tomatoes, which make up about 14 per cent of the cost of a veg thali, played a significant role in the overall price decline. Tomato prices plummeted by 51 per cent Y-o-Y, falling from Rs 102 per kilogram in August 2023 to Rs 50 per kilogram in August 2024. This sharp decrease is attributed to fresh supplies from southern and western states.

Lower fuel costs: The price of liquefied petroleum gas (LPG) cylinders also dropped substantially, further reducing the overall cost of a thali. In March 2024, the price of a 14.2 kg LPG cylinder in Delhi was Rs 803, a 27 per cent drop from the Rs 1,103 recorded in August 2023.

Vegetable oil and spices: Other ingredients such as vegetable oil, chilli, and cumin, which collectively represent less than 5 per cent of the veg thali cost, also saw a reduction. Prices of vegetable oil fell by 6 per cent, chilli by 30 per cent, and cumin by a significant 58 per cent Y-o-Y.

Broiler prices: The cost of non-veg thalis dropped more sharply due to a 13 per cent reduction in the price of broilers, which account for nearly 50 per cent of the cost of a non-veg meal.

Month-on-month thali cost reductions

On a monthly basis, the costs also eased, with the veg thali declining by 4 per cent and the non-veg thali by 3 per cent from July to August 2024. This was primarily driven by a further drop in tomato prices, which fell 23 per cent sequentially, from Rs 66 per kilogram in July to Rs 50 per kilogram in August.

For the non-veg thali, the decline in cost was additionally attributed to a 1-3 per cent decrease in broiler prices, a typical trend during the Shravan month, when non-veg consumption decreases across the country due to religious observances.

However, a 2 per cent rise in potato prices and a 3 per cent increase in onion prices on a monthly basis curbed the potential for a more substantial decrease in thali costs.

This reduction in expenses is a welcome relief for households across India, where food inflation has been a concern.

First Published: Sep 06 2024 | 1:49 PM IST