India’s commodity costs to stay higher even as war ends

Commodity prices would enactment elevated for a fewer much months adjacent arsenic the U.S.-Iran warfare comes to an end, owed to 2nd bid effects connected proviso chain, according to a survey by Sonal Badhan, Economist astatine Bank of Baroda. 

Global crude lipid prices accrued 47.7% successful February to May 2026, arsenic against a deflation of 15% successful the corresponding play past year, Ms.Badhan said citing World Bank data. Natural state and ember prices inflated 33.2% and 10.9% successful the 3 period play of the existent calendar twelvemonth compared with a deflation successful the erstwhile year. 

Prices of indispensable concern goods besides inflated significantly. The fertilizer scale accrued 37.8%. Within fertilizers, urea scale accrued 63.2%, TSP became costly 33%, and DAP became dearer by 23%. 

All metals nether the metals scale besides accrued aluminium expanding the astir (19.9%) successful the 3 period play connected a month-on-month basis. Aluminium terms emergence has led to proviso concerns, Ms.Badhan wrote. 

Global nutrient atom prices excessively were up  though the grade varied by nutrient grain. 

The survey observed that this could spill implicit to the Indian commodity prices arsenic well. Some of this has already spilled implicit to home inflation. WPI  accrued 9.7% successful May, 8.26% successful April and 4% successful March 2026. Fuel and powerfulness assemblage prices accrued 30% successful May 2026 and 25% successful April 2026. Manufacturing prices accrued astatine the fastest gait of 7.5% successful the caller series. 

“Even aft the warfare has ended, it volition inactive instrumentality immoderate clip for proviso chains to normalise and freight outgo (including outgo of insurance) to travel down. In addition, EL Nino this twelvemonth is expected to beryllium the strongest since 1950. This volition pb to adverse upwind conditions crossed the globe and person an interaction connected cultivation products,” Ms. Badhan wrote, forecasting India WPI ostentation to mean astatine 7% to 8% successful fiscal 2027.