UAE: Food prices set to drop at least 20% as freight rates fall, dirham strengthens

UAE: Food prices set to drop at least 20% as freight rates fall, dirham strengthens

Prices of food items and other goods being imported from India, Pakistan, Europe and the UK will see a significant drop due to a fall in freight rates and strengthening of the Emirati dirham against the rupee and pound, hence, helping the inflation to come down in the UAE.

Retailers estimate that the cost of food items and other consumable goods will see a drop of at least 20 per cent in the near future as a result of these two factors.

“Due to shortage of containers, freight rates had shot up to $1,100 therefore prices of foods and other goods had gone up substantially for most of the items. But now the rate has come down to $375 per 20ft container and it is expected to go down to $100-$150, thanks to the availability of containers. This will help lower food import costs and other consumer goods in the UAE,” said Dr Dhananjay Datar, chairman and managing director, Al Adil Trading.

Dr Dhananjay Datar. Supplied photo

He said freight rates are consistently declining due to the supply of containers. “Freight rates were at around $400-$450 last week which have come down to around $375.”

Moody’s Investors Service said container freight rates are down by