The Trading Corporation of Bangladesh (TCB) had hiked the price of sugar that it sells among 10 million families by Tk 30 per kg, citing a price adjustment to reduce subsidies. But it revoked the decision in the face of a public outcry.
Meanwhile, the traders are raising the price, in the pretext of a fire incident at a warehouse of a Chattogram-based sugar factory.
It was learned that the local markets are yet to see any shortage in the supply of sugar. The price also came down to a significant extent recently, owing to different government initiatives.
In a press release on Wednesday, TCB said they will sell 1kg of sugar to each of the 10 million families this month. The price will be Tk 100 per kg, though it used to sell the same amount of sugar at Tk 70.
Asked about the price hike, TCB Spokesperson Humayun Kabir said the authorities had to adjust the sugar price to decrease subsidies. Still, the government is providing an increased amount of subsidies to the product.
In a dramatic turn, TCB on Thursday backtracked from the decision and announced that it would sell sugar at the previous price. Humayun Kabir told the media through a voice message that the TCB will sell the sugar at Tk 70 per kg, instead of the newly announced Tk 100 per kg. The new decision came in the face of widespread criticism for the large-scale hike in the price.
The sugar price in the local market has been high for several months due to high import costs inflicted by the high exchange rate of dollars. The government has taken various steps to control the market, including determination of price and enforcement drives. But these brought little results.
Later, the government slashed the duty on sugar imports last month, leading to a decrease in sugar price.
But the traders began hiking the price when a sugar warehouse suffered a fire accident recently. The wholesale markets in Chattogram recorded a price hike of Tk 1 or 2 per kg in the last two days, with retail prices soaring by up to Tk 5. Each kg of sugar is now selling at Tk 142 to Tk 150.
It affected the wholesale markets in Dhaka too as the price went up by Tk 50 to 100 per sack (50 kg) there on Wednesday. Each sack is now selling at Tk 6,600 to 6,700, with the retail prices relatively yet to see any impacts.
Market insiders said even though there was a fire at a warehouse, there was no major crisis of sugar in the market. The price was on a downward trend. Now, a section of unscrupulous traders are cashing in the situation and conspiring to hike the price. They are trying to take the advantage of increased demand during Ramadan.
Golam Rahman, secretary general of the Bangladesh Sugar Refiners Association, said it is the social reality here that there remain efforts for taking advantage whenever an accident takes place.
“The rest of the factories have enough sugar in stock, import is also in progress. So there will be no shortage of sugar in the market,” he assured.
Market situation in Chattogram
A fire broke out in a warehouse of S Alam Super Refined Sugar Industries in Chattogram’s Karnaphuli Upazila on Monday. It is the country’s largest sugar supplier.
As per the updates from Khatunganj wholesale market in Chattogram, the sugar price has increased by Tk 0.50 per kg in the last three days for the government Supply Order (SO). Each kg of sugar, which was earlier Tk 133 per kg, went up to Tk 133.50 per kg under the SO on Wednesday.
The factory's general manager, Akhtar Hossain, said the burnt factory will return to production within two days. The fire affected only one of the five warehouses of the factory. It will not affect the sugar market significantly.
The S Alam Super Refined Sugar Industries factory has five warehouses, with a stock capacity of 60 thousand tonnes each. Regarding the fire incident, State Minister for Commerce Ahasanul Islam told reporters on Wednesday that there was 20 to 30 thousand tonnes of sugar in the warehouse. He thinks there will be no crisis in the market.
According to the sources of the National Board of Revenue (NBR), a total of 324,000 tonnes of sugar were imported in the last three months (December-February). Last year, 450,000 tonnes of sugar were imported before Ramadan.