Fresh food costs could rise up to 8 per cent, retailers say – Firstpost

The sharp rise in fuel prices in the United Arab Emirates (UAE) could soon be felt in supermarket aisles, with retailers warning that fresh fruits and vegetables, dairy products and frozen foods are the most vulnerable to price increases. Industry executives say grocery costs could rise by up to 8 per cent if elevated fuel prices persist

The warning comes after UAE authorities increased petrol prices by around 8 per cent for June 2026, marking the fourth consecutive monthly increase this year. Petrol prices have surged nearly 66 per cent since February amid higher global oil prices, raising concerns about the impact on food inflation.

Retail executives said products dependent on transportation, cold-chain logistics and imports are likely to face the greatest pricing pressure.

“Products that are heavily dependent on transportation, cold-chain logistics and imports are likely to witness a relatively higher increase in prices,” said Dr Dhananjay Datar, chairman and managing director of Al Adil Trading, told Khaleej Times.

Kamal Vachani, deputy CEO and group director at Al Maya Group, told Khaleej Times imported packaged foods and frozen items transported over long distances could also face upward pressure due to higher logistics expenses.

However, retailers stressed that consumers should not expect an immediate jump in supermarket prices.

Mark Mortimer-Davies, CEO of Choithrams, told Khaleej Times fuel costs represent only a small portion of the final retail price of most grocery products.

“There is a perception that a large increase in fuel prices automatically leads to a similar increase in grocery prices, but that is rarely the case,” he said, noting that raw material costs, manufacturing expenses and currency movements often have a greater influence on shelf prices.

Retailers said they are taking steps to absorb part of the additional costs and improve operational efficiency before considering price increases.

Choithrams is optimising delivery routes and increasing truck utilisation to reduce transportation expenses, while Al Maya Group is focusing on logistics planning and supplier negotiations to limit the impact on customers.

The UAE imports a significant share of its food requirements, making transportation and distribution costs an important part of the retail supply chain. While supermarket operators say competition in the market will help keep price increases gradual, they acknowledge that sustained fuel-price increases could eventually push up costs for fresh produce, dairy products and other imported food items.