The prices of everyday food items are continuously increasing. Food items have played the biggest role in the 20% increase in prices of FMCG products in the last 6 months. It is estimated that their prices may increase again by 30 percent in the next 3 months.
The prices of goods of daily needs are continuously increasing. From bathing soap to cooking oil, everything is now draining more money from the common man’s pocket. But the biggest problem is that this trend is not stopping. FMCG companies, which had increased prices in the last quarter, are preparing to increase the prices of their products again.
The biggest reason for this is that since April till now, the prices of raw materials like palm oil, coconut, tea, cocoa and coffee have increased by 35 to 175 percent. Their prices are once again expected to increase by 30 percent in the January-March quarter.
A report by Nuvama Institutional Equities claims that many FMCG companies are planning to increase the prices of their products during January-March. It states that
In the last three months, the prices of common household items have increased by about 10 percent. This will increase pressure on food inflation, which can become a road breaker for a possible repo rate cut in February.
The biggest challenge for FMCG companies is rising costs. It has become difficult to maintain margins in products like soap, snacks and tea.
-The prices of commodities like palm oil and tea are increasing by about 30 percent on an annual basis.
-It is expected that there will be a limited increase in the income of companies by about 5 percent.
If we talk about Nomura’s report, it has been estimated that Tata Consumer Products can increase the price of tea by 25 to 30 percent, out of which more than half of the increase has happened between October-December 2024. Apart from this, Nestle has increased the prices of products like chocolate by 4.9 percent. Snacks company Bikaji has increased the prices of its products by 2 percent in October-December.
But edible oil is proving to be the biggest villain of India’s food inflation. The highest increase has been recorded in its prices. according to statistics
-By September 2024, the prices of Saffola brand edible oil in India had increased by 20 percent.
-Marico has increased the price of Parachute Coconut Oil by 10 percent.
These rising prices include companies like Hindustan Unilever, Godrej Consumer, Dabur, Tata Consumer, Parle Products, Wipro Consumer, Marico, Nestle. The report shows that due to rising prices, the pressure on the common man’s pocket will increase further. In such a situation, if the government does not take any concrete steps soon, the impact of inflation may become deeper.