Andhra Pradesh - Hyderabad

Hike in rice price hits people the hardest

- PHOTO: P.V. SIVAKUMAR

Hour of crisis: The price of rice, the staple diet of many, has increased by Rs.6 a kg at one go.

HYDERABAD: The wishful hopes for a let up in the rising prices of essential commodities lay dashed with the recent bout of hike in prices of petroleum products and the inflation at its all time-high of 11.5 per cent.

And this time round, the increase has been where it hurts the most. The price of rice, the staple diet of many, has increased by Rs.6 a kg at one go. It has, indeed, caught customers unawares as for rice alone, a family of four has to shell out Rs.150 to Rs.200 more a month.

Next in the list are vegetables the prices of which have almost doubled. Though pulses have remained stable so far, next month their prices are expected to go up by at least Rs.3 per kg. It has thrown the already shoe-string budgets of many families trying to cope with the steep prices and dwindling value of money awry. Take the case of Sailaja, a home-maker. She has been hoping that a slew of measures initiated by the governments will reign in the runaway prices of essential commodities. But with the inflation galloping away, people like her are bracing up for the difficult task of pruning their family budgets further.

“The family budget balancing act is only getting tougher by the day. How much more one can compromise,” she wonders.

If families are finding it hard to cope with the ever increasing price line, the plight of retail outlets, be it neighbourhood stores or big departmental stores, is no different. Their turnovers and gross margins are dipping, a direct reflection of customers tightening their purse strings.

The month of June has been particularly tough for families with schools and colleges reopening and the additional expenditure on books, uniforms and transport.

Swarupa, a fitness expert, who regularly shops in Heritage Fresh at Banjara Hills, says for her four-member family, the budget for provisions and toiletries has gone up from Rs.10,000 to Rs.15,000. There is steep increase in the rice price and prices of vegetables just doubled here. “Every one, irrespective of his or her income, is feeling the pinch even after pruning of the list. If the government can’t hold the price line, it should at least open more ‘rythu baazars’ with their affordable prices in every locality to give relief to people.”

Chandrasekhar, who runs a neighbourhood stores, is worried as his business has been dull for the last two months. “The increased price of rice from Rs.21 to Rs.26 and the premium variety now costing Rs.28 have stunned many customers. Local brands like ‘Erra malleu’ and ‘BPT’, which now cost Rs.18 instead of Rs.12, are no longer in supply,” he rues. Oil prices which decreased by Rs.10 couple of months ago, are up with sunflower oil increased from Rs.70 to Rs.82 a kg. “There are no takers for gingelly oil which costs Rs.180 a kg.”

People are reducing the quantity of purchases and curtailing their wants. Not only food items, price rise has impacted every item -- from box of matches to washing soaps -- and “our meagre margins are getting further eroded,” he adds.

Manufacturers have devised a way of selling a product at the same price but by reducing the quantity.

For big retail outlets, though sales are not affected, their gross margins have. If a family was spending Rs.4,000 on monthly provisions, it now spends only Rs.3,000 on essentials, says a Heritage Fresh manager.

While big retail outlets used to thrive on special offers to increase volumes, now there are not many takers. ‘People just buy what they want’. Sale of ‘Health and Personal Care’, ‘Ready to Eat’ and ‘Beverages and fruit juices’ products have come down drastically.

Yet we have to keep our outlets well-stocked as the customer will not visit again. People no longer indulge in impulsive buying as they used to, he admits.

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