Vegetable prices in India are set to stay higher for longer, as erratic monsoon rains delayed planting and damaged ripening crops, farmers and traders said.
Vegetables prices, which have a 6% weighting in the overall consumer price index (CPI), hit a seven-month high in June, rising 12% month-on-month, official data shows.
Prices usually ease from August, when the harvest makes its way to the mark Prices usually ease from August, when the harvest makes its way to the market, but this year, traders expect costs to remain high until October as supplies stay tight.
“The monsoon is disrupting the vegetable supply chain. This year, we are going to witness higher vegetable prices for a prolonged period,” said Anil Patil, a Mumbai-based trader.
Costlier staples such as onions, beans, carrots, ginger, chillies and tomatoes not only feed voter discontent ahead of state elections in the next few months: The higher prices are likely to stoke retail inflation, which is expected to hit a seven-month high in July, diminishing the potential for the Reserve Bank of India (RBI) to lower rates this year.