On February 17, the Commerce Ministry set the prices of each litre loose soybean oil at Tk107 at mill gates, wholesale price at Tk110 and retail price at Tk115
Despite the government fixing edible oil prices more than a week ago, the daily essential still costs higher—something traders deny.
Interestingly, the upward trend in edible oil prices continues amid the government claiming that it was monitoring the market, reports Bangla Tribune.
On February 17, the Commerce Ministry set the prices of each litre of loose soybean oil at Tk107 at mill gates, wholesale price at Tk110 and retail price at Tk115.
Bottled soybean oil was priced at Tk123 at mill gates, Tk 127 and Tk135 at the wholesale and retail level respectively.
The mill gate price of five-litre containers of soybean oil was set at Tk585, wholesale price at Tk600 and the retail one at T630.
At the same time, every litre of loose palm super oil was priced at Tk90 at mill gates, Tk98 at the wholesale level and Tk104 at retail shops.
On the other hand, visits by Dhaka Tribune correspondents to several markets on Wednesday revealed that traders were still charging higher prices in defiance of the prices set by the government, weighing down on low and lower-middle income people.
Loose soybean oil was selling for Tk135-140 instead of Tk115 at retail stores. Palm super oil, too, got pricier as it was selling for Tk125, instead of Tk104.
Retailers were charging Tk670 for each five-litre bottled soybean oil—Tk40 more than the price set.
When contacted, Bangladesh Wholesale Edible Oil Traders’ Association President Haji Golam Mawla claimed that traders were following the government-fixed prices.
“Palm super oil is now selling for Tk96 and loose soybean oil for Tk110,” he said.
Citigroup Director Biswajit Saha, echoing Golam Mowla’s sentiment, said: “From the outset, we’ve been also charging prices as set by the government.”
He, however, refuted allegations of overpricing.
Commerce Secretary Md Jafar Uddin said the authorities were keeping an eye on oil prices.
“There is no alternative to selling oil at the prices fixed by the government. The Commerce Ministry has formed a number of teams to monitor the issue.”
According to traders, edible oil prices rose to their peak in mid-2012 when each ton of crude soybean oil was sold at as much as $1,400 in the international market, due to an acute supply crunch.
A recent report of the Bangladesh Trade and Tariff Commission says that each ton of unrefined soybean oil was priced at $743 in July last year, which jumped to $1,150 last month.
The essential product would cost Tk150-155 if sold considering the latest global prices.
Bangladesh has an annual demand for 1.1 million tons of soybean oil; 300,000 tons of palm oil and 100,000 ton of mustard oil-- 90% of which is imported. Local companies refine the imported crude edible oil to meet domestic demand.
The market players
Bangla Tribune found that five companies, which refine imported oil, controlled the local market by setting prices on their own. They also decide whether to reduce the prices and, if so, the amount.
Citygroup, TK Group, Meghna Group, S A Group, S Alam Group, Bangladesh Edible Oil, Brothers’ Group, Severn Circle Edible Oil, Dada Group and Nurjahan Group are the key market leaders in Bangladesh.
Citigroup tops the list, followed by TK Group, Meghna Group and S Alam Group.
The Trading Corporation of Bangladesh or TCB markets a little share of the total demand for oil.