Soybean oil: Refiners’ price cuts taking effect in retails
Refiners in Bangladesh have cut the price of soybean oil and the new rates have started to take effect in the kitchen markets of Dhaka.
On October 3, they slashed the retail prices of soybean oil by Tk 14 a litre after its prices in the international market dropped and the government decided to maintain a reduced value-added tax on it.
The new prices came into effect on October 4, said the Bangladesh Vegetable Oil Refiners' and Vanaspati Manufacturers' Association.
As per new rates, refiners will sell each litre of bottled soybean oil at Tk 178, down from Tk 192. The retail price of a five-litre container will be Tk 880, down from Tk 945.
Yesterday, wholesale and retail traders, however, said that it would take another three to four days for the new prices to fully come into effect.
Now some traders are selling the previously bought soybean oil at the new prices. But the products with a maximum retail price in line with the new rates have not hit the market yet.
During a visit to Karwan Bazar, one of the largest kitchen markets in the capital, and the Mirpur 1 kitchen market, it was found that a one-litre bottle of soybean oil whose price was printed to be Tk 192 is being sold at Tk 170 to Tk 175 and a five-litre bottle of Tk 945 being sold at Tk 880.
Abdul Jabbar, owner of Jabbar Store in Karwan Bazar, said it would take two to three more days for the products under the new rates to arrive at the market.
"But buyers do not understand that anymore. So, we are selling the products bought earlier at the new prices. There is no other way," he said.
Nurul Alam Sikder, a retailer in Dhaka's Mirpur, also made almost the same comments.
In some places of Chattogram, the products under the new rates have already hit the markets. However, in other places, soybean oil is being sold at the previous price.
Abu Hasan, owner of retailer Hamid Enterprises in the Hillview area of the port city, said, "We are yet to receive the new product although the price of bottled soybean oil has come down. As a result, the product has to be sold at the previous price."
He said the dealers would supply the products at the new rates on Monday. "It is not possible to sell oil at a lower price before that."
Rahim Uddin, proprietor of Shah Amanat Traders, another retail trader in the Chowkbazar area of the city, said although some products under the new rate have been supplied, it was insufficient compared to demand.
Dealers say deliveries were delayed for the Durga Puja festival.
Dealers have assured that the supply of products at the new prices will return to normalcy within two to three days, Rahim said.
Once new rates are fixed, it takes seven days for those products to reach various kitchen markets and shops across the country, said Biswajit Saha, director for corporate and regulatory affairs at City Group, one of the largest cooking oil processors.
Globally, prices of soybean oil fell to $1,599 a tonne in August from $1,752 in June and soybean prices dropped to $671 a tonne from $737, according to World Bank Commodities Price Data.
Bangladesh requires about 20 lakh tonnes of edible oil a year, according to data from the commerce ministry. Only 2.03 lakh tonnes can be sourced from local producers, with the rest met through imports.
Data from the Bangladesh Bank showed, 5,15,000 tonnes of crude soybean oil were imported in the last fiscal year, about 75,000 tonnes less than that of the preceding year.
More than 5.48 lakh tonnes of palm oil and soybean oil worth Tk 7,845 crore were imported between July 1 and August 23 through the Chattogram and Mongla ports, according to the National Board of Revenue.