After Onion, Garlic Prices Increase Pressure On Indian Household Budget, Rates Double In 6 Weeks

Garlic prices have almost doubled in the last six weeks, with retail prices for 1 kg of garlic touching Rs 250. According to The Economic Times report, the average wholesale prices are around Rs 130-140 per kg, while, the wholesale rate for best-quality garlic is Rs 220-250 per kg. Usually the price of garlic increases in December as the stocks are at their lowest.

As things stand, the retail prices of garlic are in the Rs 180-300 per kg price bracket, based on the quality of produce in different markets. Meanwhile, the wholesale prices are somewhere between Rs 150-260, said the newspaper report. A wholesale trader from Pune's Agricultural Produce Marketing Committee (APMC) was quoted by ET as saying, "Every year garlic prices rise during this period as supplies are less."

Ban on onion exports

Recently, the soaring onion prices have increased the out-of-pocket expenditure of Indian households. Onion prices were up 58% in November due to festive demand and lower production during the monsoon sowing.

In a bid to augment availability and control the inflated price of onions, the government banned exports of onions and levied additional limits on the stocking of wheat.

Retail vendors in the Delhi-National Capital Region on December 7 (Thursday) quoted onion prices at Rs 60-80 per kg. The all-India average retail price increase on Thursday was almost 98% year-on-year (YoY), showed data from the Consumer Affairs Ministry.

There are risks that food inflation might lead to an inflation uptick in November and December.

The Reserve Bank of India (RBI) projection for CPI inflation is 5.4% for 2023-24, with Q3 at 5.6%; and Q4 at 5.2%. Assuming a normal monsoon next year, CPI inflation for Q1 2024 -25 is projected at 5.2%; Q2 at 4%; and Q3 at 4.7%.