Data | Tomato inflation accelerated to 200% in July; Tamil Nadu, Andhra and Karnataka most hit

Punjab, Gujarat, West Bengal, Jammu & Kashmir and Assam recorded the least vegetable inflation in July

Updated - August 21, 2023 11:48 am IST

Published - August 21, 2023 11:47 am IST

Tomato prices have been going up and ruling at ₹200 a kg. A scene at Koyambedu Wholesale Market

Tomato prices have been going up and ruling at ₹200 a kg. A scene at Koyambedu Wholesale Market | Photo Credit: VEDHAN M

Retail inflation of tomatoes accelerated to over 200% in July — the highest-ever since at least January 2015. This in turn pushed up vegetable inflation, which quickened to 37%, leading to food and beverage inflation accelerating to 10.5% — both highest in 40 months. This was the major reason behind the sharp spike in retail inflation (7.4%) in July, the highest in 15 months.

Chart 1 | The chart shows the retail inflation of tomatoes, vegetables, food and beverages and all products combined between January 2015 and July 2023.

Chart appears incomplete? Click to remove AMP mode.

While deciding which items drove up or down inflation, it is imperative to consider the weight each item carries in the final inflation calculation.

Table 2 | The table shows the main groups which constitute the retail inflation calculation. Their weights in the inflation calculation and their retail inflation in July 2023 are mentioned.

The main group includes food & beverages, clothing & footwear, housing, intoxicants and fuel & light. As shown in Table 2, in July 2023, the food and beverages group’s inflation accelerated to 10.5%, the highest among all groups. More importantly, the food and beverages group carries the most weight in the retail inflation calculation. Put together, the component which carries the biggest weight in inflation calculation, recorded the most inflation, leading to the rapid increase in retail inflation from 4.87% in June to 7.44% in July.

Table 3 | The table shows the sub-groups which constitute the food and beverages main group. Each sub-group’s weight in the inflation calculation and its retail inflation in July 2023 are mentioned. 

The vegetable sub-group’s inflation accelerated to 37.3%, the highest among all sub-groups. Cereals & products and milk & products carry a bigger weight than vegetables. However, their inflation rates were much lower than the latter. This shows that vegetables were the major reason behind the sudden spike in food and beverage inflation.

Notably, only the oils and fats component of the food and beverage sub-group recorded a deflation in July. However, the item carries half the weight of vegetables in the calculation.

Table 4 | The table shows the items that constitute the vegetable sub-group. Each vegetable’s weight in the inflation calculation and its retail inflation in July 2023 are mentioned. 

The vegetable sub-group consists of tomato, ginger, garlic, green chillies, parwal, brinjal, lady’s finger, beans, cauliflower, radish, onion, carrot, peas, lemon, cabbage and potato. Tomato’s inflation accelerated to over 200%. Tomato also carries the third biggest weight in inflation calculation among vegetables, with only potato and onion carrying more weight. This shows that tomatoes were the major reason behind the sudden spike in vegetable inflation. While ginger prices recorded a 177% inflation, it carries three times less weight in inflation calculation than tomato, and so not necessarily contributing much to overall retail inflation figures.

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The prices of peas, lemon, cabbage and potato, recorded deflation in July. Interestingly, potato deflation narrowed to 13.5% in July, the most among vegetables. And in the inflation calculation, it carries the most weight among vegetables. This must have had a considerable impact in pulling down the overall vegetable inflation.

Table 5 | The table shows the retail vegetable inflation among various States in July 2023. 

 

The top four States which recorded the most vegetable inflation were in South India. Only Kerala bucked the trend recording vegetable inflation of 32%.

Source: Ministry of Statistics and Programme Implementation

vignesh.r@thehindu.co.in and rebecca.varghese@thehindu.co.in

Also read | Data | Retail price of tomatoes more than ₹100 a kilogramme in over 50 cities

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