Soybean oil prices leap yet again

Refiners and marketers hiked prices of packed soybean oil by at least Tk 12 a litre to match the increased prices of the vegetable oil on the world market.

Retailers yesterday sold one litre of packed soybean oil at Tk 116-118 from the previous Tk 104, while each five-litre pack was sold at Tk 570, up from Tk 510 earlier.

The latest price rise came days after retailers charged branded oil prices on a whim -- up to Tk 580 for a five-litre pack -- cashing in on a reduced supply by the refiners.

For nearly a week, the marketers tightened the supply of packed soybean oil after the loose soybean oil prices rose past the prices of packed oils.

Refiners and marketers of branded cooking oil expect the spike would improve supply at retail level.

In the wake of rising prices on the world market, high-profit expectations are encouraging hoarding, leading to an artificial crunch in the market, insiders said.

Wholesalers said the instability on the edible oil market may not ease unless there is an abundant supply.

Mostafa Kamal, chairman of leading refiner Meghna Group of Industries, expected that the supply situation would improve after the price hike. "But the government will have to monitor retailers to control a whimsical price hike," he said.

The move to increase prices came after a meeting between refiners and the price watch and fixing committee on Thursday. The meeting suggested the government set the mill-gate price of loose soybean oil at Tk 100, insiders said.

The Tk 12 price hike came amid a demand by refiners to review the prices of edible oil on the ground of rising production costs.

Bangladesh meets 80 percent of its domestic demand of nearly 15 lakh tonnes of cooking oil through imports. Vegetable oil prices have been rising on the world market for the past several months on concerns of tight supply against increased demand.

Mozibur Rahman, head of the price watch and fixing committee, said the new mill-gate price of Tk 100 was determined after negotiating with the refiners.

"I hope the supply situation will be smooth and strengthened," he said, adding that the committee would monitor the prices of bottled soybean.

Loose palm oil climbed 62 percent year-on-year at retail level, while loose soybean surged 50 percent, according to Trading Corporation of Bangladesh.

(Source: http://www.thedailystar.net/newDesign/news-details.php?nid=173972)