Retail prices of edible oil keep soaring

Just in the last two days, the price of edible oil has gone up by Tk3 to Tk10 per litre.

The new prices of five-litre bottles of soybean oil, including that of Rupchanda, Fresh and Teer, have been fixed at Tk580 to Tk625. The price of one litre soybean oil has been fixed at Tk120 to Tk125.

The Trading Corporation of Bangladesh (TCB) has also noted the increase in its daily retail market price report.

However, edible oil prices have been rising in the country's market for several months now.

According to traders, local distribution companies have started releasing oil at new prices in the market.

Motin Ahmed, a vendor at Palashi Colony Bazar in Azimpur, said every edible oil distribution company has raised prices.

Importers and suppliers have indicated an increase in prices in the international market as the main reason behind the soaring local prices. They believe that the country's market will return to its previous state only if the international market for these import-dependent products stabilise.

The average price of soybean oil per tonne in the April-June quarter of this year was $707, according to the World Bank's Commodity Market Report. But in November, it stood at $974.

Jewel Bepari, a wholesale edible oil trader in Old Dhaka, said that edible oil-producing countries Brazil and Argentina have reduced exports. Due to this, the price is increasing in the global market.

Meanwhile, TCB is selling bottled soybean oil at Tk400 per five litres through its mobile trucks. One TCB truck seller Sohag said the soybean oil ran out quickly after they started selling.

According to Ministry of Commerce sources, a letter was sent to the Bangladesh Trade and Tariff Commission (BTTC) on Thursday to verify whether the proposed oil prices are reasonable.

Earlier, the commerce ministry had held several meetings with the mill owners, where the owners mentioned that the three tiers of value-added tax (VAT) on oil imports is putting more pressure on oil import prices.

VAT on edible oil has been levied at the rate of 15% in three tiers from the budget for FY2019-20.

According to the tariff commission, the country has a demand for about 1.4 million tonnes of refined edible oil per year, 90% of which is imported.

Companies import and refine the crude oil. Then a portion of the oil is bottled and marketed while the rest is released on the market as “open oil.”