Consumers are paying more for edible oil as prices have risen in the international market due to increased shipping fare and reduced supply. Retailers say soybean oil prices in Bangladesh have gone up by up to 6 per cent, or Tk 5 to Tk 10, per litre last month.
Branded soybean oil is selling for Tk 150 per litre and non-branded oil at Tk 140 to Tk 142 a kg.
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Retailers were found selling a one-litre container at Tk 150, up from Tk 145 a month ago.
The prices range from Tk 690 to Tk 700 for the five-litre container, up from Tk 675 to Tk 680 previously.
Md Hashem, the proprietor of Fultaz Super Shop in Chattogram city, said: “All the refiners have hiked oil prices and reduced supplies owing to an import crisis and rising prices in the international market.”
The prices saw a similar increase in Dhaka.
Wholesalers at the Khatunganj-Chaktai market in Chattogram and Moulvibazar in Dhaka, two of the biggest trading hubs for edible oil in the country, said the prices went up by Tk 200 to Tk 350 per maund (37 kgs) in the last month.
Soybean oil prices rose by Tk 250 per maund to about Tk 4,500. Similarly, palm oil now costs Tk 4,280 to Tk 4320 per maund, an increase of Tk 350-Tk 375, according to traders in Khatunganj.
“The price of these products is higher as the supply is lower than demand,” said Abdur Razzak, a wholesaler.
Abul Hashem, general secretary of the Bangladesh Edible Oil Wholesalers Association, echoed the same.
“Prices are rising as the supply is low due to the countrywide lockdown,” he said.
Traders hint that the price of the cooking oil may go up further in the international markets, which will ultimately affect the prices in the local markets as Bangladesh relies on overseas markets to meet 90 per cent of the demand for the key kitchen item.
Bangladesh requires 20 lakh tonnes of edible oil annually.
The price of crude soybean oil stood at $1,345 per tonne at the end of July, an increase of $214 per tonne from June, data from the Trading Corporation of Bangladesh showed.
The price of crude palm oil rose by $152 to $1,137 per tonne.
Biswajit Saha, director for corporate and regulatory affairs at City Group, one of the largest refiners, said: “Now, it takes more time to complete the import process. Ship fares have almost doubled in the last one month.
Export-import chains are yet to normalise due to the coronavirus situation, he said.
Problems in the global production of key oilseeds coupled with rising biodiesel use have fuelled the global vegetable oil rally, according to a Reuters article in June.
Soyoil futures have jumped more than 70 per cent this year after drought tightened the US and Brazilian soybean supplies. The US Department of Agriculture has forecast global soybean stocks will fall to a five-year low of 87.9 million tonnes by September.
Palm oil prices, the most widely consumed edible oil, also rallied 18 per cent in 2020 after Covid-19 lockdowns curbed output from plantations in Southeast Asia.
Benchmark futures in Malaysia touched $1,007.30 a tonne in mid-March, their highest since 2008.