Prices of premium cigarettes up ahead of budget*****
Saturday, 7 May 2011
Jubair Hasan
Prices of premium brand cigarette--Gold Leaf and Benson and Hedges--have shot up by nearly 10 per cent in the retail market, although other brands remain almost unchanged. Both the brands are produced by British American Tobacco (BAT). Cigarette sellers said they charge 50 paisa extra for each piece after distributors increased the prices by around Tk 9-10 per packet of two BAT brands. They said wholesalers usually raise prices six to seven days before the announcement of each national budget to profit more by creating "artificial crisis" in the market. But they have broken the trend this time and raised the price more than a moth before the national budget, which is expected to be announced on June 09. Dealers, however, claimed that the supply shortage of cigarette of the brands forced them to purchase each packet of the tobacco items from other markets by paying Tk 9-10 extra to meet the ever increasing demand of tobacco consumption. Abdul Hye, a wholesaler at Shantinagar Kitchen Market, said he bought cigarettes of Gold Leaf and Benson brands by paying Tk 68.90 and Tk 108.50 against its actual wholesale price of Tk 61 and Tk 103 respectively. "We'll charge Tk 109 to 109.50 for per packet at the retail level," said Mr Hye who runs a shop named Comilla Store. Another wholesaler of the same area refused to make any comments. Retailers blamed wholesalers for the unofficial price-hike. Rafiq Mia, a retailer at Eskaton Garden in the city, said they have to pay Tk 114 and Tk 70 for per pack of those brands. "The sudden increase sometimes leads to altercation with consumers," he said. The retailer took delivery of BAT brands from its official wholesaler Agrani Traders, which could not be reached for comments Friday. BAT authorities rejected the supply shortage in the local market, saying some dishonest wholesalers and retailers are responsible for the spike. "There is no supply shortage. We have been supplying cigarettes of the brands to the wholesalers regularly," a BAT official said. The official also dismissed the question of price hike and said the government fixes price of tobacco items after the budget each year. Seeking anonymity, a van puller who carries the tobacco items to retailers, said wholesalers are hiking the price in the name of supply shortage. Smokers across the country have been paying Tk 6.0 for each stick of Benson and Hedges brand against Tk 5.50 while Tk 4.0 was charged for each of the cigarette of Gold Leaf brand whose actual price was Tk 3.50. Many smokers alleged that tobacco dealers hoarded cigarettes in their stores for more profits and created artificial crisis in the market on assumption that the government will raise taxes on such items in the coming budget.
Prices of premium brand cigarette--Gold Leaf and Benson and Hedges--have shot up by nearly 10 per cent in the retail market, although other brands remain almost unchanged. Both the brands are produced by British American Tobacco (BAT). Cigarette sellers said they charge 50 paisa extra for each piece after distributors increased the prices by around Tk 9-10 per packet of two BAT brands. They said wholesalers usually raise prices six to seven days before the announcement of each national budget to profit more by creating "artificial crisis" in the market. But they have broken the trend this time and raised the price more than a moth before the national budget, which is expected to be announced on June 09. Dealers, however, claimed that the supply shortage of cigarette of the brands forced them to purchase each packet of the tobacco items from other markets by paying Tk 9-10 extra to meet the ever increasing demand of tobacco consumption. Abdul Hye, a wholesaler at Shantinagar Kitchen Market, said he bought cigarettes of Gold Leaf and Benson brands by paying Tk 68.90 and Tk 108.50 against its actual wholesale price of Tk 61 and Tk 103 respectively. "We'll charge Tk 109 to 109.50 for per packet at the retail level," said Mr Hye who runs a shop named Comilla Store. Another wholesaler of the same area refused to make any comments. Retailers blamed wholesalers for the unofficial price-hike. Rafiq Mia, a retailer at Eskaton Garden in the city, said they have to pay Tk 114 and Tk 70 for per pack of those brands. "The sudden increase sometimes leads to altercation with consumers," he said. The retailer took delivery of BAT brands from its official wholesaler Agrani Traders, which could not be reached for comments Friday. BAT authorities rejected the supply shortage in the local market, saying some dishonest wholesalers and retailers are responsible for the spike. "There is no supply shortage. We have been supplying cigarettes of the brands to the wholesalers regularly," a BAT official said. The official also dismissed the question of price hike and said the government fixes price of tobacco items after the budget each year. Seeking anonymity, a van puller who carries the tobacco items to retailers, said wholesalers are hiking the price in the name of supply shortage. Smokers across the country have been paying Tk 6.0 for each stick of Benson and Hedges brand against Tk 5.50 while Tk 4.0 was charged for each of the cigarette of Gold Leaf brand whose actual price was Tk 3.50. Many smokers alleged that tobacco dealers hoarded cigarettes in their stores for more profits and created artificial crisis in the market on assumption that the government will raise taxes on such items in the coming budget.