Soybean oil price drops by Tk 9 a litre in Khatunganj wholesale market
The price of soybean oil dropped by Tk 9 to Tk 141 a litre in Chattogram’s Khatunganj wholesale market on Wednesday after a surge in oil price due to the impact of the Russian-Ukraine war recently.
Traders said the war disrupted the supply of soybean oil from the refineries, resulting in a crisis and a price surge. As refineries have started supplying the oil regularly, the price dropped slightly.
On Wednesday evening, the finance ministry’s Internal Resources Division (IRD) issued a gazette notification reducing Value Added Tax (VAT) by 10 per cent to 5 per cent on the import of soybean and palm oil. The exemption will be in place until 30 June.
Prior to the notification, the government withdrew VAT on production and supply of the edible oil.
Exemption of VAT on production and supply of the edible oil, reduction of VAT on import of edible oil, revised prices of soybean oil in international markets, arrival of 75,000 tonnes of soybean oil in Chattogram port and conducting drive in local makers are among the factors contributing to the price fall.
Shahed Ul Alam, owner of RM Enterprise in Khatunganj, told Prothom Alo all factors contributing to price fall have worked in the last one week. Prices were revised in international markets, VAT decreased in the country and supply also increased and that means prices fell as the crisis lessened.
Global prices of soybean oil fell by $174 to $1,637 a tonnes on 15 March from $1,811 a tonnes on 11 March at the US commodity exchange in the Chicago Board of Trade. Shipping and other costs are added to the price later.
There is a demand of 1.2 million tonnes of soybean oil 1.3 million tonnes of palm oil in Bangladesh. Most of the soybean oil is bottled oil while loose soybean oil is also sold in different rural areas. Palm oil, mostly loose, is sold at restaurants and food processing factories.
Wholesale price of palm oil also fell by Tk 14 to Tk 126 a litre from Tk 140 a litre at the beginning of this month in Khatunganj.
Loose edible oil from wholesale markets is mostly sold in rural areas. Retailers hardly sell this in cities.
According to the market report of the state-owned Trading Corporation Bangladesh (TCB), loose soybean and palm oil were not found in Dhaka markets on Wednesday.
Visiting the Khatunganj market, officials of the Directorate of National Consumer Rights Protection were seen monitoring the price of edible oil.
Officials fined M/S Harimohon Bishwas Tk 50,000 for selling edible oil at prices higher than that of prices set by the government. The fine was collected instantly.
Dulal Roy, agent of M/S Harimohon Bishwas, told Prothom Alo they purchased a supply order at Tk 6,370 a maund on 2 February but the market fell later. “At the end, we faced a loss of Tk 40,000-45,000 on a supply order of 150 mounds oil in the blink of eyes. We are totally doomed,” he added.
This report appeared in the print and online edition of Prothom Alo and has been rewritten in English by Hasanul Banna