UAE grocery prices to dip further despite global inflation

As the world battles inflation due to the higher cost of consumer goods, grocery prices in the UAE are expected to drop further in the months ahead due to a combination of factors.

A decline in freight rates, regular and uninterrupted supply of basic consumer items for UAE importers, strengthening of the dirham and accessibility to new markets are all expected to contribute to prices crawling southwards in the immediate future.

UAE retailers praised the promarket and pro-consumer policies adopted by the authorities to keep commodity prices in check. Last week, a new policy was announced under which retailers are not allowed to hike prices of nine basic consumer goods. Earlier this year, the UAE approved a new policy under which suppliers will have to submit evidence to justify price increases of basic items.

Dr Dhananjay Datar, chairman and managing director, Al Adil Trading, said the UAE'S decision to control prices of nine basic items will benefit consumers as prices of some of these items were on the rise because of the wheat and sugar export ban by India.

However, he said, the prices of most other commodities are coming down because of a decline in freight rates, which have dropped from $1,150 to $190 per 20ft container.

“Currencies of many countries which were the main source markets for UAE importers have declined against the dirham. In addition, wheat imports from Ukraine have also started, so in the next couple of months, the prices will drop due to new supply and a drop in freight rates. Hence, this is also beneficial for UAE consumers and will result in a drop in prices of about 10 to 15 per cent in the coming months,” added Dr Datar.

Kamal Vachani, group director at Al Maya Group, said they follow the guidelines and instructions of the authorities related to commodity prices in the country. “The UAE has managed to keep prices stable because the government is very pragmatic in its approach and they look at prices from the consumers' perspective as well. The government ensures that the residents get the best prices.”

In the next couple of months, the prices will drop due to new supply and a drop in freight rates.”

Dr Dhananjay Datar

Chairman and managing director, Al Adil Trading

The UAE has managed to keep prices stable because the government is very pragmatic in its approach.”

Kamal Vachani

Group director,

Al Maya Group