This Festival Season Might Be Your Priciest Yet

This year’s Diwali celebrations will come with a hefty price tag. Prices for various products — ranging from edible oils, dry fruits and chocolates to household appliances and even gold — have surged by 15-50%. This resurgence of inflation, described by many as an uninvited guest, will strain the budgets of frugal consumers as the festival season unfolds. Many are concerned that this could dampen enthusiasm and potentially curb sales."August saw robust consumer demand, but the momentum slowed in September due to global uncertainties and high gold prices," Suvankar Sen, managing director and chief executive officer of Senco Gold Ltd. told NDTV Profit. "Beginning October, we expect sales to pick up, led by Dhanteras and the wedding season, although volume might take a hit due to the sudden increase in gold prices." Sen is hopeful of a 15–18% value growth in the December quarter over the previous year.Even essential purchases have seen price hikes. According to the price monitoring cell of the Department of Consumers Affairs, the daily average retail prices of key cooking oils — mustard, sunflower and palm —have risen 7-12% following the 20% hike in import duties on crude and refined edible oils announced on September 13. Compared to a year ago, prices have risen 10-11% for mustard and palm oil, while sunflower oil has seen a 4% increase. Notably, the price surge in mustard oil can be attributed to a cascading effect..E-Commerce Retailers Face Critical Test This Festive Season Amid Quick-Commerce Boom.Industry officials NDTV Profit spoke with indicated that the sticker prices of edible oils could further harden by up to 20% in the coming days as international prices haven't softened as per expectations. Additionally, the buffer stocks are expected to last around four to six more weeks, given the heightened demand in anticipation of the upcoming festivities."While companies may choose to absorb costs for the time being to avoid disrupting demand, they will eventually be forced to raise prices to protect their margins, as oilseed prices remain elevated due to the increased import duty," said Ashish Khandelwal, managing director, B L Agro Ltd. Higher oil prices have led to a rise in the costs of savory snacks, like namkeens and Aloo Bhujia. Manoj Verma, Chief Operating Officer of Bikaji Foods International Ltd., projects a 4% increase in the company's overall expenses. "Ultimately, this will be passed on to the customers," he stated.Moreover, a host of other commodities, including milk, cocoa, coffee, and tea, remains inflationary. Cocoa, a key ingredient in chocolates, has seen prices soar in recent months, peaking at nearly $10,000 per metric tonne in March. As of Sept. 27, cocoa futures were trading at $8,186 per tonne, which is an increase of nearly 150% compared to the previous year. As brands such as Cadbury-maker Mondelez India, Hershey's, Mars Inc., as well as Nestle India contend with rising costs, this is resulting in price hikes and shrinkflation. Overall, chocolates have become 25% more expensive.Mondelez, for instance, reduced the weight of its 155 gm Cadbury Silk chocolate bar to 150 gm. while also raising the price by Rs 5 to Rs 185."Despite the inflationary pressures, we are optimistic about the season ahead supported by an uptick in urban demand," said Desmond D'Souza, vice president - sales, Mondelez India. .Retailers Flourish Online Amid Discount Wars As Festival Season Kicks Off.Consumers will also have to shell out more on gift hampers of dry fruits this festive season, as supply constraints have driven up the prices of cashews, almonds, pistachios, and apricots. For instance, the price of W-320 cashews — the most popular grade — cost 40% more at Rs 960 per kg.Sreejith Moolayil, co-founder and chief operating officer of Marico-owned True Elements told NDTV Profit that the best quality kernels are already out of stock. "Traders who had stocked up on dry fruits are now selling them to us at rates 20-30% higher," he said, adding that he does not expect the supply chain chaos to ease before December due to ongoing conflicts in key dry fruit-producing nations like the Middle East. For consumers, there has been a 50-60% jump in MRP compared to the previous year, he noted. On the other hand, there is a significant surge in demand for dry fruit hampers on e-commerce platforms, particularly as these e-tailers are offering hefty discounts to compete with quick commerce players, Moolayil said further elaborating on the demand-supply mismatch. "On the first day of Amazon and Flipkart's mega sales, we sold six times more than our daily average. I believe we'll run out of stock 10-15 days before Diwali, a situation that has never occurred in the past." To appeal to price-conscious shoppers, True Elements has unveiled a cheaper variant of its gift hamper, priced at Rs 250. Previously, the brand did not offer any gift hampers priced below Rs 500.Consumer electronics and appliance manufacturers are also weighing potential price hikes amid rising input costs and persisting supply chain issues. Wonderchef, a kitchen cookware and appliances brand, is planning to implement a 5-7% price hike in October. "The current consumer sentiment in India reflects cautious optimism," said the company's CEO, Ravi Saxena. "While a relatively stable job market and a good monsoon season have bolstered sentiment in both urban and rural areas, concerns about inflation persist.".Titan Bets Big On Budget Perfumes As Thrifty Shoppers Upgrade From Traditional Deodorants.India's apparel industry has a contrasting tale to tell as stable input costs allow brands to offer steep discounts amid fierce competition and weak demand. Take the case of H&M. The Swedish retailer has launched clothing lines priced from Rs 399 to cater to shoppers seeking affordable styles. Yet, there seems to be little optimism regarding consumer spending in this category.A recent survey conducted by the Clothing Manufacturers Association of India revealed that as many as 63% of retailers anticipate sales to remain the same or decline compared to last year."The reasons behind these low expectations vary, but the primary factor appears to be the significant shift in consumer spending towards other categories," said CMAI chief mentor Rahul Mehta. He noted that 24% pointed to a slowing economy and inflation as major challenges facing the industry. The CMAI represents 5,000 manufacturers and serves over 35,000 retailers..Bangladesh Reverses Hilsa Export Ban, Approves 3,000 Tonne Shipment To India Ahead Of Durga Puja

This Festival Season Might Be Your Priciest Yet

Industry officials NDTV Profit spoke to have indicated that the sticker prices of edible oils could further harden by up to 20% in the coming days.

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This Festival Season Might Be Your Priciest Yet

Industry officials NDTV Profit spoke to have indicated that the sticker prices of edible oils could further harden by up to 20% in the coming days.

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