Business & Finance

Festive Food Costs Surge as Dairy, Dry‑Fruit Prices Rise

By Anjali Thakur

Diwali preparations are becoming more expensive as the prices of key ingredients climb. Dairy giants Amul and Karnataka’s Nandini have increased prices amid a seasonal demand surge and supply constraints. Amul’s 1‑kg ghee now costs ₹680, up from ₹630, while its 500‑gm pure ghee pouch is ₹345, up from ₹325. Butter prices have risen too: a 100‑gm pack is ₹66, up from ₹63, and a 500‑gm pack is ₹325, up from ₹310. Amul’s online store lists ghee varieties between ₹700 and ₹740 per litre, with some products, including pure and buffalo ghee, marked as sold out.

The Bengaluru Milk Union (BAMUL) revised prices of Nandini ghee, butter, paneer and Trupti milk from 4 November, following the Karnataka Milk Federation’s recent increase in milk and curd prices. Under the new rates, Nandini ghee costs ₹425 for a 500‑ml pack and ₹850 for a one‑litre pack. Salted butter is ₹90 for 100 grams and ₹380 for 500 grams. Paneer is ₹115 for 200 grams and ₹485 for one kilogram.

Tamil Nadu’s state‑owned dairy cooperative Aavin has raised prices of ghee, butter, curd, milk‑based sweets, lassi and cookies. A 100‑ml ghee pack now costs ₹95, up from ₹80, and a 200‑ml pack is ₹180, up from ₹160.

Dry fruits, another essential ingredient for sweets and gifting hampers, have also seen steep price increases. Pistachios have risen 60‑70% since last Diwali, with Peshawari pistachios reaching a record ₹4,000 per kilogram, up about 40% over six months. Wholesale in‑shell pistachios climbed nearly 74% year‑on‑year to ₹1,650 per kilogram. Almonds have risen 20‑40% depending on variety, cashews 5‑8%, raisins 2‑5%, dates 5‑10% and dried figs 5‑15%. Importers report that sourcing nuts from Iran and Afghanistan has become more difficult due to supply disruptions linked to the US‑Iran conflict.

Higher ingredient and packaging costs have pushed the prices of sweets and premium hampers up by at least 15%. As a result, companies across sectors—including pharmaceuticals, automobiles and FMCG—are trimming their Diwali gifting lists and opting for smaller packages. Corporate gifting, which relies on bulk orders for employees, clients and business associates, is a significant seasonal demand driver for manufacturers and retailers.

The rise in ingredient prices occurs against a backdrop of elevated food inflation. In September, annual retail food inflation accelerated to 7.74%, pushing headline inflation to 5.54%, close to the Reserve Bank of India’s upper tolerance limit of 6%. Inflation in sugar, confectionery and desserts accelerated to 13.8% year‑on‑year in September, compared with 10.9% in August and 3.4% in January. Sugar prices rose 29.8% year‑on‑year in September, up from 24.3% in August. Inflation in prepared sweets, excluding milk‑based products, candy prices, ready‑made food and namkeen also increased.

The RBI has warned that price pressures are broadening across the economy. At its monetary policy review earlier this month, members cautioned that inflation was spreading beyond a handful of categories. RBI Governor Sanjay Malhotra noted that 37% of items in the consumer basket recorded inflation of over 4% in August, compared with 20% in March, indicating that price pressures were affecting a wider range of goods and adding strain to household budgets.

With dairy products, dry fruits and other food ingredients becoming more expensive, households and businesses face higher costs as they prepare for the festive season.