Rising Oil, LPG Costs Wipe Out Relief from Cheaper Vegetables; Veg Thali Remains Flat

Summary of this article

• Vegetarian meal cost remained flat in March; non-veg meal cost fell 1%.

• Lower onion, potato and pulse prices offset rise in tomatoes and oil.

• LPG and edible oil inflation kept overall vegetarian thali unchanged.

• West Asia conflict pushing up edible oil prices via crude-linked effects.

The cost of preparing a vegetarian meal at home remained unchanged in March compared with a year earlier, while the cost of a non-vegetarian meal declined by 1%, according to Crisil’s monthly food plate indicator.

The 'Rice Roti Rate' report shows that increasing inputs such as tomatoes, cooking oil and fuel offset relief from lower prices of key vegetables and pulses. Tomato prices rose 33% year-on-year to ₹28 per kg from ₹21 per kg last year same month, driven by delayed crop cycles in major producing states, including Karnataka and Andhra Pradesh.

In contrast, onion prices fell 25% year-on-year due to excess supply from overlapping harvests and weak exports, while potato prices declined 13% on lower demand and stock liquidation. Pulse prices also dropped by 6%, supported by higher stock levels.

Despite these declines, the cost of a vegetarian thali remained flat as higher vegetable oil prices, up 6% year-on-year, and a 14% increase in LPG cylinder prices added to household expenses.

"The West Asia conflict has driven up crude oil prices, which have, in turn, lifted edible oil prices amid increasing demand from the biofuel segment. Global prices of palm and sunflower oil increased during the month, transmitting to domestic markets as well. At the same time, importers have turned cautious due to high prices, reducing their procurement and weighing on ending stocks," said Pushan Sharma, director at Crisil Intelligence.

In the near term, geopolitical uncertainties are expected to keep vegetable oil prices high, he said.

The cost of a non-vegetarian thali fell slightly due to a 2% decline in broiler prices, which accounts for about half of the meal’s cost, on the occasion of Navratri.

On a month-on-month basis, both vegetarian and non-vegetarian meal costs declined, falling 3% and 2% respectively in March. The drop was supported by easing prices of tomatoes, onions and potatoes amid higher arrivals and weak demand.

As per data released, the average cost of a vegetarian thali stood at ₹26.5 in March, while a non-vegetarian thali cost around ₹54.3, reflecting a gradual decline over recent months.

Sharma expected onion prices to remain under pressure in the near term due to high arrivals and sluggish export demand. "However, with an estimated decline of 10% in production and reported damage to the summer crop (crucial for lean-season supply), onion prices are expected to gradually recover in the coming months," he said.