Edible oil prices hiked defying Bangladesh government’s decision

Refiners raised edible oil prices last week defying the government decision as branded soybean oil price hit Tk163-168 a litre from Tk155-Tk 160 earlier at the retail level.

They increased the prices despite the government's decision to review the prices at the next meeting to be held between the refiners and the government on February 06.

The refiners started supply of edible oils with new prices tagged across the county from last week, according to city groceries and digital marketplaces.

Loose soybean oil reached maximum Tk155 a litre and palm oil Tk146 a litre on Friday following a surge in bottled oil price, marking a new record, hitting hard the commoners further.

Belal Hossain, a grocer at Gadighar in Rayer Bazar of the city, said distributors have supplied them a one-litre poly pack at Tk163 and a plastic jar at Tk165 a litre.

Md Kajal, a vendor at Motijheel AGB Colony kitchen market, told the FE soybean oil (different brands) with new price tags had reached the markets.

He said they were selling a litre of loose soybean oil at Tk155 on the day which they had sold at Tk150 earlier.

A Moulovibazar-based edible oil distributor in the city said the new prices actually become effective from January 19 last as sales executives of the refiners were receiving orders at increased prices.

"We've started selling newly-supplied bottles in the last two days as per the grocers' requirement," he said.

The trader said maximum retail price (MRP) of a five-litre bottle is now Tk785 to Tk 800 depending on companies, a two-litre bottle is retailed at Tk330-335, a one-litre jar or poly pack at Tk163-Tk 168, half-litre atTk88-Tk 90 and quarter-litre at Tk45-Tk 46.

Meanwhile, online marketplaces like Unimart, Chaldal.com are supplying soybean oil of Rupchanda brand at Tk168 a litre and its five-litre bottle at Tk800, according to their websites.

Additional secretary (import and internal trade) of the commerce ministry AHM Shafiquzzaman told the FE that it was decided at the January 19 meeting that the prices would be reviewed at the meeting scheduled for February 06.

"If the prices have been increased before the next meeting, it has happened without the government's consent," said Mr Shafiquzzaman.

Contacted, Biswajit Saha, director of a leading refiner, 'City Group', said the price of soybean oil has so far been raised to Tk65 a litre as per their previous decision.

Bangladesh Vegetable Oil Refiners and Vanaspati Manufacturers Association (BVORVMA) has proposed the government to review the price as Tk168 a litre and it is expected to be fixed at the next meeting, said Mr Saha, whose company supplies essential commodities of 'Teer' branded in the market.

Mr Saha also said prices of edible oil have continued to increase in the global market for the past 18 months but the government's value-added tax (VAT) is still the same as it was.

According to the global trading web portals, soybean oil price was maximum US$ 1410 a tonne in January 2022 which was maximum $1100 a tonne in January 2021.

After reaching an eleven-year high of $1570 a tonne in October 2021, soybean oil price started to calm down but still was hovering between $1410 and 1420 a tonne, according to Index Mundi.

However, palm oil price which was maximum $990 a tonne in January 2021 has increased to $1300-$ 1350 a tonne in January 2022.

Consumers Association of Bangladesh (CAB) secretary Humayun Kabir Bhuiyan said the government should take immediate action if traders raise prices defying the government fixed rates.

Commoners are the worst sufferers who have reduced consumption of cooking oil in recent years as loose palm oil price reached Tk140-146 a litre, he added.

The government should withdraw all kinds of VAT or tax on edible oil in import, refining and trading levels, he said.

"Duties on other essential commodities, for which the country is import-dependent, should be reviewed following the decline in income of vast population as well as the rocketing price trend of essentials", he said.

According to the commerce ministry, the country has a demand for 2.0-2.2 million tonnes of edible oil annually, of which above 95 per cent is met through import.

Out of the imported oils, palm oil comprises 60 per cent and soybean oil 35 per cent.

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