Edible oil prices soar in Ctg wholesale market

No sooner had Russian troops invaded Ukraine than the prices of edible oil began soaring in wholesale and retail markets of Chattogram port city.

Traders said prices had been moving upward for the last weeks in the backdrop of Ukraine tension.

Oil dealers and businessmen claimed that increasing booking rates in the international market due to Russian invasion of Ukraine together with increase in fuel oil price are the main reasons for the price hike of edible oil in Bangladesh.

The traders also fear that the prices of all imported commodities may further increase in the upcoming months.

At Khatunganj, the wholesale commodity market in the port city, this week (until Friday) the palm oil (edible) was selling at Tk 6,000 per maund (one maund equals to 40.90 litres), Soybean Tk 7,000 per maund and super palm Tk 6,300 per maund. Just last week the prices were Tk 5,550 (Palm), Tk 6,100 (Soybean) and Tk 5,800 per maund, respectively.

Meanwhile, Bangladesh consumed 13.10 lakh tonnes of edible oil in the year 2020-21 registering a compound annual growth rate (CAGR) of nearly 5 per cent since the year 2017-18.

Adbur Rahim, an oil dealer of Khatunganj said edible oil is an imported commodity and its price solely depends on the international market. In Bangladesh, demand for edible oil rises 3 lakh tonnes during the month of Ramadan, he said.

“If the international market keeps on soaring, the price might increase ahead of the fasting month,” he told Business Insider Bangladesh.

According to the agency report on oilseeds: As per world markets and trade report in 2020-2021 Bangladesh consumed 16.10 lakh tonnes up from 15.78 lakh tonnes in the last three years.

The report also said Bangladesh was the 5th largest palm oil importing nation after India, China, the European Union and Pakistan in marketing year 2020-2021 while it was the third largest soybean oil importer the same year.

Biswajit Shaha, Director for corporate and regulatory affairs of City Group, one of the leading edible oil importers and processors, said, approximately 45% of oil production globally has been affected by Covid-19 and several natural disasters.

The freight charge also increased due to the Russia-Ukraine Conflict, resulting from increasing oil prices in all the importing countries, he added.

He also said whether the price of edible oil might increase or not depends on NBR and that the price increased several times in the country last fiscal year.

The country’s annual consumption of oil and fats currently stands at 30.3 lakh tonnes, 92% of which is met through imports. Bangladesh mostly imports soybean from Brazil and Argentina and palm oil from Indonesia and Malaysia, respectively.

Around 27.73 lakh tonnes of edible oil, fats and oil seed worth $2.12 billion were imported in 2019-20 FY, according to the council of Palm Oil producing Countries (CPOPC) report titled ‘edible oil and fat consumption trend in Bangladesh.’

At the commodity market in the city, the price of five litre bottles are: Rupchanda Tk 770, Teer Tk 765, Fresh Tk 760 and Pusti Tk 755, respectively which was at least Tk 20 less for a five-litre bottle some days back. One litre bottle is now being sold at Tk 162 this week which was Tk 155 last week.

“We sell per litre of Soybean oil according to the Maximum Retail Price (MRP) rate,” Said M Babul, Owner of Bhai Bhai Store at Kazir Dewri.