Brace for high prices this festive season

Consumers may have to pay higher for festive buys this season. With diesel pric?es increasing, truckers and transporters have raised fre?ight charges, stoking fears of a spike in essential and other consumer items.

Traders have so far absorbed the additional transport cost. But they may increase prices once old stocks are sold off. As freight cha?rges have risen 10-15 per cent over the last 15 days, traders could start sharing the additional cost burden with consumers.

“We hope the government will contain the fuel price hike. But if it continues to rise, we will have no option but to hike prices as increasing transportation cost is impacting margins,” said Praveen Khandelwal, secretary general of Delhi-based Confederation of All India Traders (Cait).

Both diesel and petrol pr?i?ces have been on fire in recent days with oil marketing firms revising prices upward on high crude import cost and depreciation in rupee. Diesel price in the national capital has risen almost 9 per cent in the last 45 days.

The oil companies are currently selling diesel at Rs 73.87 a litre, up Rs 6.05 from Rs 67.82 on August 1. It has broken all records, raising pressure on the government to soften prices.

Rise in fuel prices increases transport cost making fruits, vegetables and other goods dearer.

The Indian Foundation of Transport Research and Training (IFTRT) has said truck rentals on most trunk routes have outpaced rise in diesel prices. In a report, it said the cost of moving goods roundtrip on the Delhi-Mumbai sector with payload of 15-18 tonne has jumped Rs 3,000 against Rs 2,100 increase in fuel cost.

Similarly, truck rentals on the Delhi-Kolkata route has increased Rs 2,800 while fuel cost has risen Rs 2,200. “Freight cost had jumped on most other trunk trade rout?es till Sunday evening,” IFTRT senior fellow SP Sin?gh said.

Chander Agarwal, managing director, TCI Express, said his company has passed on the cost of rising diesel prices to consumers by increasing fuel surcharge it levies on freight movement.

“Fuel is a major factor in transportation cost. We have raised fuel surcharge to pass on the cost of recent increase in diesel prices. We revise our charges on fortnightly basis,” Agarwal said.