The Financial Express

Edible oil prices hit nine-year high in Bangladesh market

Experts for cutting import duties sans delay

| Updated: November 26, 2020 17:02:39

Evaly and Fianancial Express Evaly and Fianancial Express
Edible oil prices hit nine-year high in Bangladesh market

Edible oil prices hit a nine-year high in the country, as loose soybean oil retailed at maximum Tk 115 a litre on Wednesday.

Palm oil, the key cooking oil for poor, soared further to Tk 102-105 a litre, showing Tk 6.0-7.0 hike in a week.

Most of the refiners have further raised prices of branded bottled soybean oil by Tk 5.0-6.0 a litre, as the new prices have been set as Tk 120-125 a litre.

A five-litre jar will cost Tk 570-600, when the new bottles will be available in grocery shops within a few days, marking Tk 30 hike per jar, said traders.

It is the second time in this month and sixth time in the last three months that the companies have raised prices of edible oil, they added.

The current prices of soybean oil and palm oil have soared to nine-year-high, according to the Trading Corporation of Bangladesh (TCB).

The prices are also 30-50 per cent higher than those of a year ago.

The surge in cooking oil prices is adding to the woes of common people, already battered by high prices of various essential items, such as rice, potato, sugar, fish and meat etc.

"All the grocers will get bottles with new price tag within one or two days following the sale of their old stock," said Moloy Kumar Sarker, a Nilphamari-based agent of Fresh brand items, products of Meghna Group.

He also said many groceries have old bottles, which are being sold at previous rates.

Md Golam Rabbani, a Moulvibazar-based trader in the capital, said they are now getting loose soybean oil at minimum Tk 106 a litre from the refineries.

"We are now selling soybean oil at Tk 108-109 a litre. Super palm oil is being traded at Tk 98-100 a litre at Moulovibazar."

Prices of loose soybean oil and palm oil have increased by Tk 12-14 a litre in last three weeks, he added.

Market experts, meanwhile, suggested reviewing edible oil import duties immediately to keep prices within the reach of limited-income people.

The refiners have been raising cooking oil prices following a gradual hike in their prices in the international market for the last seven months, City Group Director (corporate and regulatory affairs) Biswajit Saha told the FE.

He said the Bangladesh Vegetable Oil Refiners and Vanaspati Manufacturers Association (BVORVMA) urged the government to collect VAT on soybean, palm and palm olein at 15 per cent only at the import stage instead of collecting it at three stages.

"Considering edible oil as daily essential, we placed a proposal in this regard to the Ministry of Commerce in 2019, and again through the Bangladesh Trade and Tariff Commission (BTTC) in this July-August."

He urged the National Board of Revenue (NBR) to consider the issue actively following sufferings of people.

Meanwhile, an official concerned said the ministry has forwarded a letter of the BVORVMA to the NBR this month, requesting the board to take necessary measures. However, the NBR is yet to act on the matter.

Humayun Kabir Bhuiyan, secretary of the Consumers Association of Bangladesh (CAB), said import duties on edible oil should be cut immediately to give the commoners a relief.

"As the country is fully dependent on imported edible oil, imposing higher import duties on the product is surely an injustice during the pandemic."

He noted that both poor and middle-income people have been suffering a lot for long due to skyrocketing prices of various essentials.

Above 85 per cent of imported edible oil is sold in loose form in the country, and the low-income households are its main consumers. The surge in loose edible oil price has directly hit the poor.

Apart from reviewing the duty structure, strict market monitoring is also needed to check any artificial price hike of the item, he opined.

According to the Ministry of Commerce, the country imports 2.2-2.6 million tonnes of crude soybean oil and palm oil annually against the domestic demand of 2.2 million tonnes.

Of the total import, soybean accounts for 0.7-0.8 million tonnes and palm oil 1.4-1.6 million tonnes, while the remaining are mustard, sunflower, rice bran and other edible oils.

Global commodity web-portal Index Mundi data showed that crude soybean oil price increased to US$ 914-920 a tonne in October-November period from $680-700 a tonne in April-May period.

Palm oil price also hit $820 a tonne in October from $580-600 a tonne in April, it added.

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