Edible oil prices likely to decrease

FE Report | Published: July 05, 2023 22:43:17

The government plans to once again reduce the prices of edible oil following the downward trend in the global market, according to sources.
The commerce ministry is expected to convene a meeting with stakeholders, including the edible oil refiners, to determine the new prices based on recommendations from the Bangladesh Trade and Tariff Commission (BTTC).
Earlier in mid-June, the government lowered the prices of cooking oil.
The prices of cooking oil have been adjusted multiple times in response to fluctuations in international prices. The downward trend in international market prices of cuisine oil began in May 2022.
As per estimates from the World Bank, the price of soybean oil stood at US$838 per tonne in 2020, but it increased to US$1,963 per tonne in May 2022. Subsequently, global soybean oil prices fell to a one-year low of US$1,130-1,150 per tonne in April.
When contacted, a senior official said, "From June 11 onwards, the price of crude soybean in the global market has ranged between US$912 and US$1025 per tonne (fob), which has been taken into consideration for reducing the prices in the local market."
On June 11, 2023, local edible oil refiners, as prescribed by the commerce ministry, reduced the maximum retail price (MRP) of bottled oil by Tk 10 to Tk 189 per litre from Tk 199.
They also lowered the MRP of a five-litre soybean oil jar to Tk 920, while the MRP of one litre of loose soybean oil was set at Tk 167. Besides, the price of palm oil was adjusted from Tk 135 to Tk 133.
Senior Commerce Secretary Tapan Kanti Ghosh announced the prices after the 7th task force meeting held at his Secretariat office on June 11.
Following the meeting, the secretary expressed hope that if the international prices remain stable, there will be a reduction in the price of local edible oil, which is currently under review.
According to the information presented at the task force meeting, the price of crude soybean oil in the world market on June 8, 2023, decreased by 43.77 per cent compared to June 8, 2022. However, in the local market, the decrease was only 2.0 per cent.
Similarly, palm oil prices in the global market also experienced a decline of 48.69 per cent. However, this global price reduction trend has not been reflected in the local market, where the reduction was only 20 per cent.
Currently, importers are required to pay a 15 per cent ad valorem duty on the import of crude soybean and palm oil.
The government had previously granted duty waivers on the import of edible oil to rein in the rising prices over the past few months.
According to the commerce ministry, the country has an annual demand of over 2.0-2.2 million tonnes of edible oil, of which more than 95 per cent is met through imports.
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