Plan under way to help edible oil importers

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The commerce ministry will propose a change in the prevailing system of payment that is forcing edible oil importers to suffer losses, reports bdnews24.com.
The ministry will make the proposal to help the importers avoid losses due to the fast appreciation of the dollar against the taka and to contain the prices of the item.
Generally, Bangladeshi importers make payment at the prevailing rate of he greenback when they open their letters of credit LCs. But, cooking oil importers are required to make payments at the rate prevailing at the time of unloading their goods at the port. This system is called deferred payment.
Sources inside the commerce ministry said it will propose the Bangladesh Bank to change this system.
An official seeking anonymity told the news agency that Commerce Minister G M Quader will raise the issue at the next cabinet meeting. Once approved there, the ministry will send a formal proposal to the central bank which it will discuss with the rest of the banks.
"Although price of edible oil is steady internationally, the dollar is getting pricier against the taka. Thursday, the banks charged Tk 86.30 per dollar for payments above $ 10,000," the official said.
"Considering the time of opening their LCs, dollar was cheaper than Tk 78, these businessmen are incurring huge losses," the official added.
On July 20 last year, the government fixed retail soybean oil price at Tk 109 per litre and palm oil at Tk 99. According to the Trading Corporation of Bangladesh, soybean is now selling at Tk 124 to Tk 128 a litre in Dhaka.
The ministry's move comes against the backdrop of recent demands by importers to raise retail prices of edible oil.