Trade
2 years ago

Another stroke to consumer price rises

Refiners raise soybean oil price sharply again

Bottled oil becomes costlier by Tk 12 a litre, sugar, egg, onion prices also up

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A latest hit comes from edible oils as sugar, eggs and onions also became costlier to further augment woes of consumers already smarting under high inflationary pressure.

The government permitted private refiners to raise soybean-oil price by Tk 9.0- Tk 12 a litre from Wednesday. The new MRP of bottled soybean oil has become Tk 199 from the day after the adjustment.

Loose soybean oil price has been re-fixed at Tk 176, up from the current Tk 167, while palm-oil price has been set at Tk 135 from Tk 117 now. 

The adjustment was a result of end of the VAT immunity on import and production stage of both palm and soybean oils.

In March 2023, the government cut VAT at import level to zero from the earlier 15 per cent while it was reduced to 5.0 per cent at production stage from 15 per cent.

The fiscal facility ended on April 30 and the refiners gave a proposal to raise brand soybean prices by Tk 18 a litre the same day, said a commerce ministry official.

“However, after the meeting between the refiners and the commerce ministry with the presence of the Bangladesh Trade and Tariff Commission (BTTC) on May 3, it was settled that the one-litre bottled soybean will be increased by Tk 12,” he said.

The five-litre-jar price has been set at Tk 960 by jacking up from Tk 906 although their proposal was far higher for Tk 1005.

Palm oil witnessed the maximum hike as the price was fixed at Tk 135 a litre from the MRP of Tk 117 earlier.

Meanwhile, the sugar refiners have also given proposal to the commerce ministry to raise sugar price to Tk 135 a kg from Tk 109.

Shish Haider Chowdhury, member of BTTC, told the FE that the commission and the commerce ministry were yet to come to a decision over the sugar issue.

“The ministry has orally told the refiners to fix the price at Tk 117 for loose and Tk 122 for packet sugar. It might be finalised Sunday.”

He also informed the FE that the commerce minister is now on a visit to Geneva.

“After his arrival, the commerce ministry will request the finance ministry to give the oil refiners the VAT immunity again so that the price could be minimised further,” he said.

The Bangladesh Sugar Refiners Association (BSRA) on May 2 sent a letter to the commerce ministry for instruction to import sugar at high prices from the international market.

They claimed that the price of raw sugar had increased to $675 a tonne from $520.

The letter says the BSRA members were in a quandary as to whether to import the item at such a high rates.

“Due to the price hike on the global market, the sugar-import price would be Tk 131 a kg, including Tk 35 in taxes,” the letter reads.

However, while the government has yet to give any announcement, sugar market has become volatile as most groceries were running out of the essential on Thursday.

The distributors stopped supplying the item waiting for a concrete decision, the FE found while visiting groceries in different city areas.

The outlets where sugar was available it was retailed at Tk 140-150 a kg against Tk 125-135 a kg seven days back. The government-set price of the sweetener is Tk 104 and Tk 109 a kg.

Meanwhile, farm egg price further increased to Tk 146-150 a dozen on Thursday from Tk 135-140 earlier, marking 7.0-8.0-percent rise in a week and 15-16percent in last two weeks, said the Trading Corporation of Bangladesh (TCB).

Onion price continued to rise also this week as retailed at Tk 55-60 a kg on the day, showing a 22-percent hike in a week.

Consumers Association of Bangladesh (CAB) secretary Humyaun Kabir Bhuiyan says the government will have to minimise its dependence on daily essential commodities for its revenue generation, “especially on those products, for which the country is almost import-dependent.”

He said the country is almost import-dependent on edible oils and sugar.

“So realising Tk 30-Tk 40 in taxes from per kg or litre of such products is unethical during this tough period when millions of people are in a fix for record inflationary pressure,” he says.     

“Following the global price hike as well as around 30-percent depreciation of the Bangladeshi currency against the US dollar, the National Broad of Revenue (NBR) should set logical levies on such daily necessaries taking into consideration the present condition of millions of low-income people.”

He also urged the government to take stern action against the companies which had raised prices of sugar long before the government could come to any decision.

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