UAE: Grocery items’ prices likely to drop soon

Prices of many commodities and grocery items in the UAE are expected to drop in the coming months on the back of high production and imports following a good monsoon expected in India.

India is one of the largest exporters of pulses, spices, rice, wheat and other commodities to the UAE. Trade of such goods has increased substantially after the signing of the Comprehensive Economic Partnership Agreement (CEPA).

Private weather forecasting agency Skymet last week said that India will see a normal monsoon in 2024 and there will be no impact of El Nino. It expects “sufficiently good rains” in India’s southern, western and north-western parts. Punjab, Rajasthan, Uttar Pradesh and Haryana are known as the farm bowl of north India due to the agriculture sector.

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India allowed another 10,000 tonnes of onions to be exported to the UAE just days ahead of Eid Al Fitr. Onion prices went through the roof after India imposed the ban last year, rising from as low as Dh2-3 per kg to over Dh8 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 for Al Maya Group, anticipates a significant uptick in imports from the Indian Subcontinent, driven by robust agricultural output expected from India.

“India has long been a crucial trading partner and we’re excited about the potential of this year’s monsoon to bolster our import portfolio. We foresee a notable increase in the import of essential commodities, including rice, flour, spices, lentils, and an array of other consumer items,” he said.

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