Globally food prices have been increasing since the outbreak of COVID-19. FAO's food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat, and sugar shows a steep rise in global food prices for seven months consecutively till December 2020 which turned out to be a record since 2014 (The Hindu, 2021).  In countries like India, access to nutrient-rich food to all is a challenge even in normal times. The steep rise in food prices as a result of COVID-19 pandemic could further accentuate the nutrition deficiency which will have long-run implications on mental and physical health (Headey et al, 2020). However, Kakarlapudi and Renjith (2020) showed that Kerala has been successful in maintaining the food prices lower than the rest of India and all other South Indian states during the pandemic through active policy intervention. Going beyond the aggregate trends, this study compares the changes in food prices before and during the pandemic at a disaggregate level to identify the commodities that experienced major changes in prices during the pandemic. Further, this article breaks up commodities into largely produced (domestically) and largely imported and analyses the price variation as the COVID-induced restrictions disrupted the supply chain and production.

The monthly Consumer Price Index (CPI) data published by MOSPI for 12 food and beverage items has been used for the analysis. The CPI data is available till November 2020. Due to COVID restrictions, the data at the disaggregate state level is not available from March to July 2020. Hence, pre-pandemic analysis is based on the average price growth of August to November 2019 and compares the average price growth for the same months in 2020.  A more disaggregate commodity level price data has been accessed from the Kerala price bulletin, published by the Department of Economics and Statistics, GoK and spices data has been accessed from the respective commodity boards.

Food prices before the pandemic

As noted by Kakarlapudi and Renjith (2020), the price of food and beverages before the pandemic were higher in Kerala as compared to all India average and all other south Indian states except Tamil Nadu. The average increase in the price of food and beverages during four months (August-November) in 2019 was 6.9 percent in Kerala as compared to 5.8 percent for All India. In all Southern states, except Tamil Nadu (7.8 percent), the price increase has been higher than Kerala. The disaggregate analysis for 12 food items indicates that the price rise is higher in Kerala as compared to all India trends in eight out of twelve commodities.

However, commodities such as eggs, fruits, oil and fats, and non-alcoholic beverages showed a lower price rise than the rest of India and other southern states (Table 1). Karnataka shows higher inflation in cereals and products (4.7 percent) than Kerala (3.1 percent) while Andhra Pradesh and Telangana shows the lowest price change. Among all the commodities, vegetables show highest increase in prices followed by meat and fish, and pulses and products. Though Kerala shows marginally higher inflation in vegetables (22.1 percent) as compared to the national average (21.1 percent), it is lower than Andhra Pradesh, Karnataka and Tamil Nadu. In case of meat and fish and spices, price difference between Kerala and All India was as high as 6 percentage points. The consumption expenditure round of NSS shows that Kerala has highest per-capita meat and fish consumption.

Table 1. Consumer price changes in Kerala and the other southern states before the pandemic (August to November 2019 in %)

Source: Author’s construction using CPI data available at http://164.100.34.62:8080/Default1.aspx

Food prices during the pandemic

Food prices increased significantly during the pandemic when compared with pre-pandemic trends. At all India level growth of food and beverage prices increased from 5.8 percent during the pre-pandemic period to 9.2 percent during the pandemic. For all India, most of the commodities except fruits showed higher growth in prices during the pandemic. Inflation is found to be highest in vegetables (17.5 percent) followed by meat and fish (17.3) eggs, pulses and products (around 16 percent), and oil products (14.7 percent) (see Table 2). Kerala depicts a completely different pattern. First, while eight out of twelve products show higher inflation in Kerala as compared to all India before the pandemic, the trend reversed during the pandemic. Secondly, unlike what was observed for all India trends, there is no significant increase in prices of food and beverages in Kerala. Inflation is lower during the pandemic than pre-pandemic in case of cereals, fruits and vegetables while for all other commodities it is just the opposite. During the pandemic, Kerala shows lowest inflation in cereals and products in comparison with all other southern states. It is important to note that inflation in vegetables declined drastically (2.3 percent) during the pandemic as compared to pre-pandemic trends (22.1 percent). Kerala's exemplary initiatives such as provision of food kits and encouraging home production of vegetables could be the reasons for the observed trend. Among all other commodities, pulses and eggs showed a very high price growth in Kerala during the pandemic.

Table 2. Consumer price changes in Kerala and the other southern states during the pandemic (August to November 2020 in %)