Bottled soybean oil shortage hits retail markets; mill owners propose price hike

Soybean oil in one-litre and two-litre bottles is in short supply in grocery stores across Dhaka, with retailers alleging that mill owners are reducing oil supplies in anticipation of a price hike.

A visit to around 15 grocery stores in Kalyanpur, Hatirpool, and Moghbazar today (6 December) revealed a severe shortage of soybean oil.

Karwan Bazar shops also lacked stock, with limited quantities reported in a few stores. Retailers claimed these supplies were insufficient to meet demand.

Jyoti, a resident who shops near the Kalyanpur bus stand, visited three stores but could not find bottled soybean oil. At the BRTC market, her search continued unsuccessfully. Speaking to The Business Standard, Jyoti shared, "Some stores have five-litre bottles, but I need two litres, which I can't find."

Shopkeeper Alamgir Hossain said, "For three days, we haven't received any bottled soybean oil. Wholesale sellers claimed there is a shortage, leaving us unable to sell to our regular customers."

Bottled soybean oil is priced at Tk167 per litre, but retailers reported that edible oil companies are releasing less bottled oil to the market. While demand exceeds supply, wholesalers provide only a fraction of orders. Manufacturers cited rising global prices as the cause and have proposed a price hike to the government.

Mohammad Babu, a vendor at Karwan Bazar, said, "We need 400 litres daily but receive only 40 litres."

Similarly, Ali Hossain from Yasin General Store said, "For two weeks, we received less oil than needed, but now, the supply has stopped altogether. Mill owners have reduced supplies due to anticipated price increases."

Biswajit Saha, director of corporate affairs at City Group, an edible oil importer, confirmed a 40% global price hike.

"Yesterday [5 December], the Tariff Commission called us. We proposed increasing the price of soybean oil there," he said.

He explained that despite a 10% duty reduction, production costs remain high, and banks hesitate to issue Letters of Credit (LC) because profits are not feasible under current conditions.

"We've requested the government to align local prices with international rates," Biswajit Saha added.

A meeting with the commerce adviser is planned to resolve the matter, he said.

As of 8:30pm today, Bloomberg data showed that soybean oil prices on the Chicago Board of Trade (CBOT) jumped to $0.43 per pound, marking a 4% increase from the $0.41 per pound closing price on 2 December.

To stabilise edible oil supply and prices, the government reduced VAT from 15% to 10% on crude soybean oil, refined palm oil, and soybean seeds in October. In November, VAT on local production was waived, leaving only 5% on imports.

According to the Tariff Commission, the country's annual edible oil demand is 2.2 million tonnes, while domestic production accounts for only 2,00,000 tonnes.

Meanwhile, unbottled soybean oil was selling for Tk200 per kg in Kalyanpur and Tk185 in Karwan Bazar.

Fish prices drop slightly

A visit to fish markets revealed that prices have dropped by Tk20 to Tk30 per kilogram compared to the previous week.

Medium-sized shrimp are selling for Tk600 to Tk650 per kg, while Ruhi fish is priced at Tk300 per kg. Last week, Pabda fish was sold for Tk350 to Tk400 per kg, but this week, it is available for Tk300 to Tk320 per kg.

Green chillies are being sold for Tk80 to Tk100 per kg. Broiler chicken is priced at Tk180 per kg, and a dozen red eggs are being sold for Tk150.