UAE: Will There Be a Drop in Prices of Grocery Items?

UAE: Will There Be a Drop in Prices of Grocery Items?

Anticipated ample rainfall in India this year is poised to bring relief to consumers in the UAE, as prices of various commodities and grocery essentials are projected to decrease in the coming months.

India, a key exporter of pulses, spices, rice, wheat, and other goods to the UAE, is expected to boost its production and imports following a positive monsoon outlook. The Comprehensive Economic Partnership Agreement (CEPA) has further facilitated trade between the two countries, contributing to increased supply.

According to Skymet, a leading private weather forecasting agency, India is forecasted to experience a normal monsoon season in 2024, with no anticipated impact from El Nino. Favorable rainfall is predicted across southern, western, and north-western India, including key agricultural regions like Punjab, Rajasthan, Uttar Pradesh, and Haryana.

In response to rising onion prices, India has permitted an additional 10,000 tonnes of onion exports to the UAE ahead of Eid Al Fitr. Last year's export ban caused a surge in onion prices in the UAE, reaching as high as Dh8 per kg from previous levels of Dh2-3 per kg.

Dr. Dhananjay Datar, chairman and managing director of Adil Group of Supermarkets, said the new crop is very good, therefore, the Indian government allowed export to the UAE and other key trading partners.

“Even crops of other foodstuffs and grains are quite satisfactory because there was no flood in India. In February-March 2024, mostly the grain, spices and vegetables come in the season. And good production in India will have a positive impact on the UAE markets in terms of prices as there could be more imports from India,”

he said.

Dr Datar added that crops of rice, pulses, millets, and spices such as chilly, turmeric and coriander are very good this season and this will reflect positively on the local prices in summer.

Moreover, there are some additional duty discounts offered for food items imported from India to the UAE under the CEPA signed in 2022.

Kamal Vachani, Group Director and Partner at Al Maya Group, is optimistic about a substantial surge in imports from the Indian Subcontinent, buoyed by the anticipated robust agricultural output from India.

"India has been a vital trade ally, and we're eager about the potential impact of this year's monsoon on enhancing our import portfolio. We expect a significant rise in the import of essential goods, including rice, flour, spices, lentils, and various consumer products,"

he stated.

India's agriculture sector, heavily dependent on monsoon precipitation, is set for a plentiful harvest, promising high-quality produce for export markets. Consequently, consumers in the UAE can anticipate an abundance of fresh fruits, vegetables, and spices sourced directly from Indian farms. The ample supply from India is projected to drive down prices in local markets.

"Our shelves will be brimming with a diverse array of Indian goods, ranging from luscious mangoes to aromatic spices, catering to the diverse palates of UAE residents,"

Kamal Vachani added.

He added that the increased influx of Indian goods is expected to not only satisfy local demand but also stimulate export activity to other countries in the region.

News Source: Khaleej Times

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