The Statistical Center of Iran has reviewed price changes in 53 food products in the third fiscal month (May 22-June 21).
The biggest month-on-month price rise for a food item in urban areas was recorded for hydrogenated oil with 247.2%, which was sold for 835,459 rials ($2.56) per kilogram, latest data released by SCI show.
The second and third biggest month-on-month price increase during the period under review was registered for vegetable oil with 233.8% and macaroni with 56.1%.
Vegetable oil was sold at 720,813 rials ($2.21 cents) per 900 grams and macaroni went for 172,800 rials (53 cents) per 500 grams.
Only two out of 53 food items examined by SCI experienced a price decline in the third fiscal month compared with the previous month.
Watermelon with 2.4% and pomegranate with 0.9% were sold for 70,182 rials (22 cents) and 468,565 rials ($1.44), respectively.
Compared with the same month of the previous year, the retail prices of vegetable oil increased by 332.3%, registering the highest year-on-year price rise. It was sold at 720,813 rials ($2.21 cents) per 900 grams.
The second and third biggest year-on-year price rise was registered for hydrogenated oil with 272.2% and potato with 172.2%. A kilogram of hydrogenated oil was sold at 835,459 rials ($2.56) and a kilogram of potato went for 169,179 rials (52 cents).
None of the 53 food items registered a year-on-year price deflation in the month under review.
Food prices skyrocketed after the government recently overhauled the subsidy system for importing essential goods.
The government move saw the abolition of the controversial practice of allocating cheap dollars at the rate of 42,000 rials per dollar, locally known as Preferential Foreign Currency, for the import of essential goods, including corn, soymeal, unprocessed oil, oilseeds and barley, in addition to wheat, flour and medicine.
Instead, it deposited cash directly to the account of income deciles 1 to 9.
The market value of the dollar is above 300,000 rials at present.
“Until now, we have been paying to producers [read importers] but now the subsidies go to consumers. In fact, the Preferential Foreign Currency has not been ceased, rather the allocation method has changed,” President Ebrahim Raisi said in a televised speech on the eve of the introduction of the move last month.
In his speech, Raisi emphasized that the removal of cheap dollar allocation will not lead to a price rise in wheat, flour and medicine. However, the move led to a dramatic rise in the prices of essential goods.
Also known as necessity or basic goods, essential goods are products consumers will buy, regardless of changes in income levels.
In fact, the prices of all commodities have also risen suddenly in a ripple effect.
Latest SCI data on inflation confirm prices have reached unprecedented levels.
Food prices increased by 25.9% in the third fiscal month compared to the previous month.
With a coefficient of 26.64%, the Consumer Price Index for “food and beverages” stood at 738.1 in the month to June 21, indicating a year-on-year increase of 82.6%. The average annual inflation of the group stood at 52%.
The general goods and services CPI (using the Iranian year to March 2017 as the base year) reached 482.1 in the month to June 21, indicating a 12.2% rise compared to the previous month.
This is the highest monthly price rise on record in SCI’s database (since 2018).
Month-on-month consumer inflation was 3.5% in the preceding month.
The average CPI in the 12 months to June 21 increased by 39.4% compared with the corresponding period of the year before.
SCI had put the average annual inflation rate for the preceding Iranian month (ended May 21) at 38.7%.
Consumer price inflation for the month under review jumped by 52.5% over the same month of the previous fiscal year while year-on-year inflation in the month ending May 21 was 39.3%.
SCI put average inflation for urban and rural areas at 38.9% and 41.8%, respectively. CPI registered a YOY increase of 51.4% for urban areas and 58.2% for rural areas in the month.
CPI reached 473.2 for urban households and 531.9 for rural households, indicating a month-on-month increase of 11.5% and 15.8%, respectively.
