Refiners raise edible oil price

Prices of cooking oil and tomato, two different items consumption of which increases significantly in Ramadan, witnessed notable rise in the market last week, augmenting woes of the consumers, especially the commoners.

Soybean oil, which saw a two-time price hike in March, became costlier by Tk 5 per litre in the past week which traders attributed to the rising price hike of the cooking oil in the global market.

Ignoring the commerce ministry's decision not to hike edible oil prices during the remaining part of Ramadan month, refiners raised soybean oil prices by their own by Tk 5.0 a litre in the middle of Ramadan.

The government reset and raised the maximum retail prices of cooking oil on March 15, 2021, second time in one month, in an excuse of its spiralling international rates.

Last week, a majority of the refiners increased the maximum retail price (MRP) of bottled soybean oil to Tk 144 per litre from the government-fixed rate of Tk 139 which was set on Mar 15 by the ministry of commerce.

The latest round of edible oil price hike has taken place without the consent of the commerce ministry which was yet to announce a new rate which they did for the last three months (Jan, Feb and Mar), sources said.

Jewel Rana, a grocer at West Dhanmondi, on Friday said, old soybean jars was selling at Tk 139-141 per litre, a Tk 2.0 a litre hike, which was an impact of the announcement made by the refiners to raise the prices.

He said distributors have told them that bottled cooking oil with new price tag will be supplied to them within the next couple of days.

The maximum retail price (MRP) for a 5-litre bottle would be Tk 680-690 when the new packs are supplied to the market, he added.

Echoing him, other grocers said, the enhanced price of bottled oil has impacted loose soybean and palm oil which were increased by Tk 3.0-4.0 a litre last week as was sold at Tk 125-126 per litre yesterday.

Super palm oil was retailed at Tk 115-117 a litre on the day.

Contacted, director of City Group, parent concern of 'Teer' branded soybean oil, Biswajit Saha, told the FE that they had sent a proposal to the Bangladesh Trade and Tariff Commission (BTTC) first on March 10 to raise the oil price to Tk 144 a litre.

"We had sent another proposal on April 19 to the Commission to review the price and set it at Tk 160 a litre considering the rising trend in the international market," he noted.

He tried to justify their latest price hike by saying they have fixed the new price by themselves following their previous proposal.

To give a logical ground for their decision, he said the price has been fixed following existing rules and norms.

Mr Saha said crude soybean oil prices are now above $1,280 per tonne and their costing is minimum Tk 162 a litre.

Following the rising trend in edible oil prices both in the global and domestic market, the commerce ministry from February 2021 started resetting the MRP of soybean and palm oil considering the import costs and other issues.

The National Price Fixing Committee, a body under the commerce ministry, on March 15 announced the MRP of bottled oil and mill-gate rate of loose soybean oil after consulting with the importers, millers, wholesalers and trade body leaders, according to commerce ministry sources.

But the latest hike in soybean oil prices have come without any announcement by the National Price Fixing Committee.

Contacted, additional secretary of commerce ministry, Shafiqul Islam, told the FE that the ministry will seat with the traders soon to discuss the matter.

He said that prices of the commodity have been showing an upward trend for several months which impacted the domestic market.

The ministry had already requested refiners to stick with the government-fixed price for the remaining days of Ramadan, the month of fasting and restrainment for Muslims.

Bangladesh's annual edible oil demand is above 2.0 million metric tonnes (mt) of which more than 90 per cent is met by imports. Soybean oil comprises 0.35-0.5 million of the import while palm oil import is 1.3 million to 1.5 million tonnes.

Meanwhile, tomato prices increased by Tk 10-15 a kg as was sold at Tk 40-55 per kg based on varieties on the day. Costs of other vegetables remained static in the week maintaining their previous high.

However, staple rice witnessed a Tk 1.0-2.0 per kg decline at wholesale level which was yet to impact the retail market.

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