A syndicate of traders has become active to hike the prices of sugar to make windfall gains ahead of the holy month of Ramadan, said market insiders.
In the last one and a half weeks, the sugar price has jumped 10 to 12 per cent without any valid reasons.
Market observers termed this sudden hike 'illogical', saying that the price of the item remains much lower in the global market.
Retailers have been selling sugar at Tk 60-Tk 62 a kg over the last few days, up from Tk 52-Tk 55 a kg earlier, according to groceries in the city.
The wholesale price in Dhaka also rose to Tk 56-Tk 58 a kg from Tk 50-Tk 52 a kg, said traders in Karwan Bazar and Moulvibazar wholesale markets in the city.
However, the price of branded packets of sugar remains stable at Tk 60 a kg.
The state-run Trading Corporation of Bangladesh (TCB) recorded a 10-12 per cent hike in sugar price on the local market in the last one week. "The price of sugar was increasing at a time when the importers have a good stock of the item and the global rate is much lower," said deputy director (market information and research) of the Department of Agricultural Marketing (DAM) Ashraful Hossain.
A syndicate of unscrupulous traders is active to make the market volatile ahead of the festive season to gain hefty profits, he added.
He also said refined sugar price should not be more than Tk 45 a kg at mill gates as the import cost of crude sugar is less than Tk 32 a kg at present.
According to IndexMundi, a global commodity web portal, sugar prices remained almost stable at $280-$290 a tonne for the last six months.
Ranajit Majumder, a Chattogram-based commodity agent, told the FE that traders were forced to buy sugar at Tk 50-Tk 51 a kg at mill gates instead of Tk 47-Tk 47.5 a kg, as a syndicate earlier grabbed most of the DOs issued by leading refiners like S Alam, City, Meghna and Deshbandhu.
He said the actual DO rate of sugar is Tk 1760 per maund (37.32 kg), but it now costs Tk 1860-1870 for traders.
Contacted, City Group director (legal and regulatory affairs) Biswajit Saha told the FE that they were selling sugar at Tk 47.5 a kg for the last two weeks.
He said the rate might have fluctuated by only Tk 0.10-Tk 0.12 a kg following normal market trend.
The government agencies concerned should conduct drives both in mill gate areas and city wholesale markets to get the real picture, he suggested. A senior official of a leading refining company, wishing not to be named, said a seasonal syndicate has been active to dominate the market ahead of Ramadan.
"The price, however, might ease soon as there is ample supply of sugar," he said.
According to the commerce ministry, local refiners imported more than 2.7 million tonnes of sugar in nine months of the current financial year against the annual demand of 2.6 million tonnes.
Meanwhile, the TCB has started its market operation ahead of Ramadan, selling edible oil, chickpea, lentil, date and sugar at 35 spots in the city. Sugar was selling at Tk 47 a kg at the TCB's sale spots.
But the supply is too small to have any impact on the mainstream market, said market insiders.
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