India’s food inflation climbed to 7.74% in September from 5.97% in August, with onion prices more than doubling over the past year and costs of ginger, garlic and lemon also rising sharply. Poor rainfall and the threat of a strong El Nino have added to concerns over agricultural output, with economists warning that food-price pressures could continue into 2027.
Onion prices more than double
Data released by the National Statistics Office on Monday showed onion inflation jumping to 108.09% in September from 48.78% in August. Ginger prices rose 62.85%, garlic 54.62% and lemon 36.41% over the year.
The price surge comes after India recorded its lowest June-September rainfall in more than a decade. According to India Meteorological Department data, this year's monsoon rainfall was the fourth-lowest since 2001 and the 13th-lowest since 1901.
The possibility of a particularly strong El Nino has raised further concerns. The weather phenomenon, caused by the periodic warming of sea surface temperatures in the Eastern Pacific, can alter rainfall and temperature patterns. Parts of Maharashtra, Andhra Pradesh, Punjab and Haryana are facing extreme drought conditions, threatening crop output, soil moisture and reservoir levels.
“We reckon that beyond oil-related input costs, adverse weather is adding to food-price pressures, with El Nino potentially persisting into 2027,” said Emkay Global Financial Services lead economist Madhavi Arora.
Supply shortages push up vegetable prices
Shortfalls in crop production are adding to the pressure. Garlic output in Rajasthan, a major producing state, is estimated at around 60% of last year's level, said Deepak Pareek, founder of consulting organisation HnyB.
Ginger prices have also risen due to domestic supply losses and firm international prices. Pareek said poor crop quality last year led to storage losses, while a crop failure in Nigeria pushed up export prices. The condition of the upcoming kharif crop, particularly in Maharashtra and Karnataka, remains a concern.
The impact is visible in household staples, too. On September 24, retail rice prices averaged Rs 46.43 per kg, against Rs 43.15 a year earlier. Tur dal rose to Rs 125.18 per kg from Rs 116.12, while packed groundnut oil increased to Rs 210.04 per kg from Rs 188.53.
However, the rise has not been uniform. Potato prices were down 11.50% year-on-year in September, while tomato prices fell 8.62%.
Rabi crop faces weather risks
Crisil senior director and principal economist Dipti Deshpande said food inflation was being driven by a low statistical base, surging onion prices and rising global prices of rice, wheat, maize, edible oils and sugar.
Attention is now turning to the rabi sowing season. Low soil moisture and high temperatures could threaten crops, including bajra, tur, maize, groundnut, rice and soybean in areas with rainfall deficits and limited irrigation.
“Food inflation is likely to remain firm in the coming months as weak rainfall weighs on agricultural output,” Deshpande said.