Fruits and vegetable price in Abu Dhabi dived by up to 34 per cent in January to extend a three-month downward trend caused by a steady fall in world commodity prices due to the global financial crisis, official figures showed yesterday.
The price of fish, rice, meat and many other essential food items averaged lower in January compared with the December prices, while other items stabilised and a handful of products recorded slight increases.
According to the Abu Dhabi Department of Planning and Economy (DPE), the prices of 41.2 per cent of the items listed on its commodities index recorded a decline, while 37.3 per cent stabilised and the rest were slightly higher.
Analysts said the decline in Abu Dhabi reflected a general drop in food prices in the UAE because of lower global commodities prices following a steady and rapid increase over the past two years.
Analysts expect further declines in the coming months and said this would ally with a sharp fall in the prices of building materials and other products to sharply depress UAE inflation, which has climbed to double-digit rates in the past two years due to higher global prices, the weak US dollar and a surge in domestic demand as a result of the economic boom.
"After this decline in January, DPE's statistics section expects stability in the prices of most food items in the emirate over the next few days," DPE said.
Its figures showed hamour fish recorded the biggest decline in January, tumbling by around 15 per cent per kilo, while there was a drop of between four to 10 per cent in rice prices and three to 10 per cent fall in prices of dairy products.
Fruit and vegetable prices declined between four and 34 per cent last month because of excess supply from local and foreign markets. The prices of some varieties of meat also retreated by around three per cent. "Dealers explained the prices of some products declined because of lower prices by the suppliers," the report said.
The decline, which is expected to continue in the coming months, followed a steady increase in the first nine months of 2008 because of surging global food prices. The surge has prompted some Gulf nations, including the UAE and Saudi Arabia, to embark on plans to invest in farming projects in fertile countries.
Abu Dhabi launched its first regular consumer price index (CPI) comprising more than 50 food items five months ago. It was later updated and made available on a weekly basis at its website and main shopping outlets in the emirate.
The index for the preceding three months showed there was a surge in the prices of rice, fish and meat but the price of most other listed items recorded relatively stability, indicating that a series of price stabilisation agreements signed by the Ministry of Economy with several local retail outlets succeeded in controlling spiralling prices of consumer products.
According to DPE, the sediments of the index were based on findings of a survey on family income and spending, which was conducted in 2007. The survey identified some 53 food and other consumer items, which accounted for about 14.91 per cent of the family spending in Abu Dhabi.
"The index will be regularly and continuously updated and will be available at most of the outlets and stores in Abu Dhabi. This will make access to price information easy for the general public. The next step would be to post this index on the Department's website," DPE said.
"The department will also design a news bar on its website, showing commodity price trends. Apart from food, beverage, and tobacco, new price sediments will be added in accordance with latest trends."