Connect with us

Agri Biz

Despite significant drops in global markets, palm oil prices are still high

Published

on

oil

The price of palm oil has dropped drastically by at least Tk3,500 per maund in the international market in the beyond four months, but the commodity is still selling at a higher rate in the domestic market.

Although the booking price is decreasing every day, it has remained static in the domestic market for the past three weeks, having eased by only Tk1,500, according to brokers.

In Malaysia, the world’s largest palm oil producer, it is currently selling at RM3,690 per tonne, which was RM7,500 in May. As such, market data shows the booking rate has almost halved in the last four months.

Adding the costs of transportation and refining to the international booking rate, the average price in the country stands at Tk3,800 currently, said shippers and brokers.

But it is selling for Tk4,800 at the mill level and for Tk5,500 at the wholesale level. That means importers are making an extra profit of Tk1,000 per maund (40.90 liters) of palm oil.

When Indonesia announced a ban on palm oil exports on 28 April, the edible oil market in Bangladesh became unstable immediately and the price jumped by up to Tk800 per maund within just two days.

On the day of the announcement, palm oil was selling for Tk6,200 at Chattogram’s Khatunganj, one of the country’s largest wholesale hubs for household essentials but the price jumped to Tk7,000 on 1 May.

Consumers complain that as soon as the price of edible oil goes up in the international market, importers and traders increase the price in the domestic market without any delay. But when the global price drops, it does not make any effect on the local market even for a few months. In this way, consumers are constantly getting washouts.

Advocate Akhtar Kabir Chowdhury, president of the Chattogram Chapter of Transparency International Bangladesh, alleged when the price goes up in the world market, importing companies put pressure on the government regulatory agencies to adjust prices at the wholesale and retail levels.

“The pump oil price has dropped in the global market for the last four months, but the price has not decreased to that extent in the domestic market. The companies are robbing the rights of the consumers by making an additional profit of Tk1,000 on each maund of edible oil,” he added.

Pradeep Karan, deputy general manager of Citigroup, an edible oil importer and edible oil packaging company, said the demand for the product in the wholesale market has decreased slightly due to the drop in the prices in the global market.

“Products that are currently available in the market were bought at higher prices earlier. As a result, even though the demand has dropped, importers are unable to reduce the price,” he added.

Pradeep Karan claimed that the price at which the product is being sold is lower than the price set by the government.

Analyzing the international market, it has been found that the price of edible oil is decreasing almost every day in the international market. In just ten days, the booking price of palm oil per tonne has fallen by more than RM600, which has decreased by RM3,800 in the last four months.

According to mpoc.org.my data, on 8 September crude palm oil was booked at RM3,690 per tonne in the international market. On 24 August, the booking price was RM4,308. Accordingly, the booking price has decreased by RM618 in ten days.

Traders said after selling at record prices in March-April, the edible oil market has started to ease slowly. Now the price is decreasing every day. But the price has not decreased much in the domestic market.

Mahbubul Alam, president of the Chattogram Chamber of Commerce and Industries, said after an increase, the price of any product, including edible oil, returns to stability gradually. This is the norm of the market.

He said importers should also reduce the price of the product due to the decrease in the global market and in this case, the regulatory authorities have the most important role to play.

“Regulatory agencies should carefully adjust the prices in the domestic market with the international market. Because, the current price drop in the world market can also put importers at great risk,” he added.

Share this
Click to comment

You must be logged in to post a comment Login

Leave a Reply

Agri Biz

TCB Approved to Procure 1.10cr Litres of Edible Oil, 10,000 Metric Tons of Lentils

Published

on

tcb

The Cabinet Committee on Government Purchase (CCGP) has given approval for the Trading Corporation of Bangladesh (TCB) to procure 1.10 crore litres of edible oil and 10,000 metric tons of lentils. The TCB will conduct these purchases as part of its open market sale (OMS) program.

In a meeting presided over by Finance Minister Abul Hasan Mahmood Ali on February 29, the CCGP approved two separate proposals presented by the commerce ministry on behalf of TCB.

According to the proposals, the TCB will import 1.10 crore litres of soybean oil through an open tender from City Edible Oil Ltd. The total cost of this procurement is Tk174.66 crore, with each litre priced at Tk165.25.

Additionally, the TCB will acquire 8,000 metric tons of lentils from Nabi Naba Food Limited, costing Tk83.12 crore, with each kilogram priced at Tk103.09.

Share this
Continue Reading

Agri Biz

Rice Varieties and Prices Must Now be Printed on Bags, says Ministry of Food

Published

on

Rice Varieties and Prices Must Now be Printed on Bags, Declares Ministry

The Ministry of Food has issued a directive mandating the inclusion of selling prices of rice at mill gates and the specific rice varieties on bags. The move aims to curb potential price hikes and enhance transparency in the rice market. According to the announcement on Wednesday (21 February), rice-producing millers must display essential details such as mill name, district and upazila name, production date, mill gate price, and rice variety on bags before supplying for commercial purposes.

The ministry’s decision follows observations in various rice-producing districts, revealing the sale of rice from the same paddy type under different names and prices. The notice highlights the blame game among millers, wholesalers, and retailers during sudden price fluctuations, causing inconvenience for consumers in obtaining desired rice varieties at fair prices and leading to financial strain.

To enforce these guidelines, the ministry emphasizes that information on rice bags should not be handwritten with ink. Instead, rice-producing mill owners must ensure that all sacks/packets bear printed details as specified. Corporate bodies are also required to adhere to these guidelines, with the option to include maximum retail prices in addition to mill gate prices.

District administrators, upazila executive officers, and food controllers are instructed to confirm compliance during inspections. Any violation of these guidelines may result in necessary actions as per the provisions outlined in the “Production, Storage, Transfer, Transportation, Supply, Distribution and Marketing of Food Products (Prevention of Prejudicial Activity) Act, 2023.”

 

Share this
Continue Reading

Agri Biz

Govt Initiatives Drive Lentil Cultivation, Targeting High Yields

Published

on

Lentil

Around 54,101 tonnes of lentils are expected to be produced from 35,380 hectares of land in the division during the current Rabi season, officials said.

The Department of Agricultural Extension (DAE) has set a production target of 32,411 tonnes of lentils from 20,620 hectares of land in four districts of its Rajshahi Agricultural Zone and 21,690 tonnes from 14,755 hectares of land in four other districts of the Bogura Zone.

DAE’s Additional Director Shamsul Wadud stated that all possible measures were taken to achieve the production target, providing farmers with newly developed high-yielding varieties of lentils. Small and marginalized farmers received seed and fertilizer support for lentil cultivation free of cost under the government’s agriculture incentive program.

Abul Kalam Azad, a farmer in Godagari Upazila, mentioned that he cultivates lentils to avoid irrigation water-related hassles for paddy. He cultivated lentils on six bighas of land this year without incurring extra irrigation costs. Farmers in the region find lentil cultivation appealing due to lower irrigation expenses and have witnessed abundant production in recent years.

Zakir Hossain, another farmer, highlighted that growers are increasingly interested in lentil cultivation due to its lower irrigation cost and consistently high yields in recent years. Sub-Assistant Agriculture Officer Atanu Sarker noted that farmers have achieved better yields in cash crops due to the promotion of high-yielding varieties and modern management practices.

Efforts from government and non-government entities are encouraging farmers to cultivate water-saving crops like lentils in the Barind area to alleviate the growing pressure on underground water resources. Over 1,500 volunteers are engaged in promoting water resource management for less water-consuming crops as part of the Integrated Water Resource Management (IWRM) Project.

Farmers’ interest in lentil cultivation has grown as they have experienced lucrative market prices for the crop in recent years. IWRM Project Coordinator Jahangir Alam Khan explained that farmers in high Barind areas, facing high irrigation costs for paddy farming, find lentil cultivation appealing due to its lower irrigation requirements.

Dr. Jagadish Chandra Barman, Principal Scientific Officer at the Bangladesh Agriculture Research Institute, emphasized the potential for significant lentil output in the Barind region. Cultivating lentils on around 80,000 hectares of fallow land after the harvest of transplanted Aman paddy could substantially contribute to reducing the country’s reliance on lentil imports.

The article concludes by highlighting the bright prospects of increasing lentil acreage, producing larger quantities with lower production costs, and reducing the pressure on lentil imports to meet domestic demand.

Share this
Continue Reading