Govt cuts duties on edible oil, eggs to ease price pressure

Amid skyrocketing commodity prices, the interim government is taking decisive measures to curb prices, offering much-needed relief to average consumers burdened by high food inflation, which remains above 10% for months.

The measures include reducing import duties on edible oil and eggs, exempting duties on the import and production of poultry feed, and sourcing vegetables directly from farmers through private non-profit organisations like fashol.com for retail sales in Dhaka.

"The import duty on eggs has been reduced to 13% from 30%. Besides, the duty on edible oil has been reduced by 5%," Chief Adviser's Deputy Press Secretary Abul Kalam Majumder said in a press briefing yesterday.

Besides, the government has decided to reduce the value-added tax on edible oil at the consumer level, he said.

The agriculture ministry launched an Open Market Sale (OMS) programme yesterday, offering 10 agricultural products, including eggs, onions, potatoes, and vegetables, at 20 locations in the capital.

OMS sales of essential products for ready-made garment workers will begin today. The event will be inaugurated at the factory of Zaber and Zubair Fabrics Ltd in Tongi in the presence of Youth and Sports Adviser Asif Mahmud and RMG industry leaders.     

Youth and Sports Adviser Asif Mahmud yesterday said the government will adopt a "hardline" approach to control rising commodity prices.

During a meeting at the secretariat, he said any corporate companies deliberately involved with syndicates in the market would be brought to book under the Special Powers Act.

In a meeting with edible oil refinery owners at the Commerce Ministry yesterday, Finance and Commerce Adviser Salehuddin Ahmed said the government wants to stabilise oil prices at any cost.

Edible oil prices were last hiked in April by the former Awami League government, but since then, international soybean oil prices have risen by 15% and palm oil by 19%.

Mill owners have been pressuring the government for another price hike, warning that without it, imports may decline, leading to a supply crisis.

Data from the Commerce Ministry show that crude soybean oil's freight on board (FOB) price went up from $873 per tonne in April to $1,002 in October, and palm oil from $910 to $1,080 per tonne.

Based on these adjustments, the Bangladesh Trade and Tariff Commission estimates bottled soybean oil would increase by Tk5 to Tk172 per litre, and bottled palm oil by Tk8 to Tk143 per litre. Currently, these are priced at Tk167 and Tk135, respectively.

During the meeting, commerce ministry and NBR officials told oil mill owners that the import duty cut would offset the global price hike.

However, mill owners rejected this, insisting that prices be adjusted according to international rates.

The government firmly stated that oil prices could not be increased and urged mill owners to stabilise the market by lowering their profit margins.

Commerce Secretary Md Selim Uddin told TBS, "The government aims to provide relief to the public by keeping essential goods prices stable. Despite a $200 per tonne increase in international edible oil prices, we have not agreed to raise prices. Instead, we will reduce import duty by 5% to prevent any increase."

"We've asked traders to cooperate in maintaining market stability by not raising prices and to accept reduced profits for now," he added.

Measures to lower egg prices

The secretary also said that reducing egg import duty and feed costs will bring down prices.

He explained that egg prices are also rising in India. "Since poultry feed costs are higher in Bangladesh, our production costs are higher. Moreover, eggs in India weigh 45 grams, while in Bangladesh, they weigh 65 grams, resulting in higher prices here," he said.

The government is also taking steps to reduce poultry feed costs to lower egg and chicken production expenses.

"Any necessary policy changes or duty exemptions will be discussed with the NBR to keep feed prices stable at all costs," said the commerce secretary.

Egg prices are set at Tk142 a dozen

The Directorate of National Consumers' Rights Protection yesterday set egg prices effective from Wednesday at Tk10.91 per piece at the producer level, Tk11.01 wholesale, and Tk11.87 retail.

After a meeting with egg producers and suppliers, the organisation's Director General Alim Akhtar Khan told reporters that a dozen eggs would cost Tk142.44 at the consumer level from Wednesday.

Eggs must be sold at government-fixed rates without the involvement of middlemen, he said, attributing the recent price hikes to middlemen's market manipulation.

Egg prices have skyrocketed in recent days amid reports of hoarding and supply shortages. In the capital's Karwan Bazar and Mohammadpur Krishi Market, eggs are being sold at Tk180-190 per dozen.

The Department of Agricultural Marketing set the maximum retail price for eggs at Tk11.87 per piece on 16 September. But eggs are still being sold at Tk15 or higher.

The government recently also approved the import of 4.5 crore eggs to ease the supply crisis, they have yet to arrive in the country.

Middlemen blamed for vegetable price surge

According to Commerce Ministry officials, middlemen are responsible for the rise in vegetable prices. However, removing them is tricky.

To counteract this situation, the ministry plans to regulate market prices by increasing fair-price vegetable sales in the open market.

Efforts are also underway to source vegetables directly from farmers through private-sector non-profit organisations.

Currently, Fashol.com, a private non-profit organisation, collects 80 tonnes of vegetables daily from farmers and distributes them to retailers from Tejgaon, Dhaka.

The ministry has engaged with the organisation and proposed expanding its operations to reach retail buyers across Dhaka, offering facilities like warehouses.

Commerce Secretary Selim Uddin said, "Such organisations will submit proposals to the ministry this week and receive government support. This initiative will allow vegetables to be sold directly from farmers to retail buyers at lower prices, positively impacting the market."

10 agri products at affordable prices

The government yesterday launched an initiative to provide consumers with 10 agricultural products at affordable prices.

Inaugurating the OMS programme in front of the Food Building in Dhaka yesterday, Commerce Adviser Salehuddin Ahmed said the goal is to keep essential items within consumers' purchasing power.

Initially, the products will be sold via trucks at 20 locations across the capital, including Food Bhaban, Manik Mia Avenue, Mirpur 10, Bashabo, Basila, Rayer Bazar, Rajarbagh, Mugda-North and South, Palashi Mor, Hazaribagh, Mohammadpur, Gabtali, Mohakhali Bus Stand, Begunbari, Uttarkhan, Dakshin Khan, Kamrangirchar, Rampura, and Jhigatala.

Under this programme, prices include one kg of potatoes for Tk30, a dozen eggs for Tk130, one kg of onions for Tk70, and one kg of green papayas for Tk20.