Edible oil, tea, coffee, soap to see higher prices this quarter
Subscribe to enjoy similar stories. New Delhi: Makers of soaps, edible oils, tea and coffee are likely to raise prices of their products following a spike in commodity prices, the companies said. In the September quarter, coffee prices were up 60% year-on-year (y-o-y), tea 25%, and palm oil 10%.
Top fast-moving consumer goods (FMCG) companies such as Hindustan Unilever Limited (HUL), Adani Wilmar and Tata Consumer Products Ltd (TCPL) are either planning to hike prices of their products in the December quarter or have already brought in some increases in the quarter gone by. This comes at a time when urban demand for FMCG products has dampened, and rural is just about shaking off its stupor, forcing companies to do a tough balancing act to ensure price rises don’t lead to unhappy customers, and yet not impact volumes and margins. Meanwhile, even as crude oil prices fell 10% in the quarter, edible oil prices rose following the government’s decision on 14 September to raise the basic custom duty on refined palm oil, refined sunflower oil, and refined soybean oil to 32.5% from 12.5%, with an effective duty rate of 35.75% on refined oils.
Prompted by this move, edible oil and flour maker Adani Wilmar said on Thursday that it is set to raise prices of cooking oil by at least 20% in the current (December) quarter. Also read | Investors shy away from FMCG stocks but embrace quick commerce platforms: Why? This is likely to impact its December quarter volumes, Angshu Mallick, the company's managing director and CEO told Mint in an interview. In the September quarter, the company’s edible oil segment revenue grew by 21% y-o-y with an underlying volume growth of 17% y-o-y.
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