Vegetables Price Pinch: 29% Indian households surveyed say they have reduced the consumption of essential and green vegetables to cope with the price rise in the last few months

Oct 16, 2024, New Delhi: Vegetable prices have spiked in most cities due to disruption in supplies and damage to several crops. While the summer monsoon is over, adequate supplies of many crops like onion, tomato, green leafy vegetables is not arriving in the wholesale markets leading to higher-than-normal prices in the retail market, such that the central government through state-owned organisations is providing subsidised onions in cities like Delhi. The price impact of disruption in supply of vegetables varies a lot between markets as production is highly localized and fragmented.

Annual retail inflation, based on the All-India Consumer Price Index (CPI), rose to 5.49% in September, a nine-month high, due to higher food prices. This is the highest retail inflation rate since December 2023, when it was 5.69%. It was 3.65% in August. Food inflation, which makes up half of the consumer price index (CPI) basket, rose to 9.24% annually compared to a 5.66% rise in August. It stood at 5.42% in July, 9.36% in June, 8.69% in May and 8.70% in April, according to the ministry of statistics and programme implementation (MoSPI).

The cost of a home-cooked vegetarian thali surged 11% year-on-year (y-o-y) in September, driven by rising vegetable prices, rating agency Crisil Ltd said in a report. It states that the rise in the vegetarian meal cost can be attributed to sharp increases in the prices of key vegetables, including onion, potato and tomato, which account for around 37% of the cost.“Vegetable prices displayed mixed trends in September. Onion prices surged by 53%, potatoes by 50% and tomatoes by 18% on-year due to lower onion and potato arrivals and heavy rainfall impacting the tomato output in Andhra Pradesh and Maharashtra,” the Crisil report states.

LocalCircles periodically tracks impact of higher prices of essentials on households. Continuing the effort, it has conducted a new survey to find out how the households are coping with higher vegetable prices. The survey received over 40,000 responses from households located in 351 districts of India. 63% respondents were men while 37% respondents were women. 40% respondents were from tier 1, 27% from tier 2 and 33% respondents were from tier 3, 4 and rural districts.

Vegetables Price Pinch: 1 in 2 Indian households surveyed are now paying INR 75+ per kg for tomatoes, INR 50+ per kg for onions & INR 40+ per kg for potatoes

Prices of vegetables vary not only across the country but within the cities too. The survey asked household consumers, “What best describes the per kilogram price that your household paid for tomato, onion and potato in your purchase?” Out of 15,260 consumers who responded to the question 56% stated that they bought “tomato for INR 75 or more, potato for INR 40 or more and onion for INR 50 or more”; 29% stated that they bought “tomato for INR 50- 75, potato for INR 30-40 and onion for INR 40- 50”; 6% of respondents stated “tomato for INR 50 or less, potato for INR 30 or less and onion for INR 40 or less”; and 9% of respondents did not give a clear answer. To sum up, 1 in 2 Indian households surveyed are now paying INR 75+ per kg for tomatoes, INR 50+ per kg for onions & INR 40+ per kg for potatoes.

Vegetables Price Pinch: 29% Indian households surveyed say they have reduced the consumption of essential and green vegetables to cope with the price rise in the last few months

Forced by budgetary concerns, some households stop buying or cut down on quantities as prices of essentials rise. In the case of potato, tomato, onion and other vegetables this may be a difficult choice if they are intrinsic to the family diet. The survey next asked household consumers, “How has your household been coping with the higher prices of essential and green vegetables lately?” Out of 14,619 consumers who responded to the question 29% stated that they “have reduced consumption somewhat to stay within budget”; 42% stated that they “have kept consumption the same and paid more”; while 29% stated that they “have kept consumption the same but buying from sources that sell at lower prices”. To sum up, 29% Indian households surveyed say they have reduced the consumption of essential and green vegetables to cope with the price rise in the last few months.

In summary, the survey shows that 1 in 2 Indian households are now paying INR 75+ per kg for tomatoes, INR 50+ per kg for onions & INR 40+ per kg for potatoes. In this scenario of high prices, 29% Indian households surveyed say they have reduced the consumption of essential and green vegetables to cope with the price rise in the last few months. However, 29% of respondents stated that they have kept consumption the same but are buying vegetables from sources that sell them at lower prices. Though the government has stepped in to procure onion and sell it at subsidised prices, this benefit is restricted to residents in a few cities. The Government should either ensure such interventions are at a national level or provide relief by reducing petrol and diesel prices to assist with the budget squeeze faced by many households.

Survey Demographics

The survey received over 40,000 responses from households located in 351 districts of India. 63% respondents were men while 37% respondents were women. 40% respondents were from tier 1, 27% from tier 2 and 33% respondents were from tier 3, 4 and rural districts. The survey was conducted via LocalCircles platform, and all participants were validated citizens who had to be registered with LocalCircles to participate in this survey.