Further price hike of Ramadan commodities likely despite ample imports

Official data indicates adequate imports of Ramadan commodities — mainly chickpeas, sugar, dates, and edible oils, yet concerns are there regarding further price hike of these items during the fasting month.

Importers said the products imported ahead of Ramadan match or exceed demand to ensure a stable supply chain during the month. However, due to factors such as the rise in the dollar price, higher LC margins, higher customs assessment value and duties, the prices of goods are higher this year compared to last year.

For instance, about a week before Ramadan, there was a notable increase in the prices of dates in the market. Last Ramadan, lower-tier dates were sold for Tk150-180 a kg while the price now stands at Tk280-300. However, the National Board of Revenue (NBR) data suggest import of dates between December and February was enough to meet the Ramadan demand. 

The same holds true for chickpeas and sugar, except edible oil. Soybean oil prices saw a decline of around Tk20-25 a litre compared to last Ramadan, thanks to the global price fall.

Adequate imports

According to NBR data, around 7,00,860 tonnes of these four types of products were imported through the Chattogram port in the last three months. 

Chittagong Port Authority Secretary Md Omar Faruk told TBS that most of these imported products have been cleared and reached the consumer level. With a focus on expediting clearance and delivery operations immediately after discharge from the ships, importers now can retrieve goods from the port within six hours after completing the customs clearance process. 

According to Chittagong Customs House, from December to February, around 33,541 tonnes of dates, over 1,00,000 tonnes of sugar, 4,75,000 tonnes of edible oil, and 91,354 tonnes of chickpeas were cleared through customs. Only 5% of essential goods brought for Ramadan are awaiting clearance now.

Chattogram Port handles 92% of the import and export trade in the country. 

Biswajit Saha, director of Corporate and Regulatory Affairs at City Group, a major consumer goods importer, told TBS, "Despite challenges like dollar price hikes, we have imported Ramadan essentials in line with the country's demands, ensuring no supply shortages or price instability." 

He, however, urged consumers not to buy commodity products in large quantities at once before Ramadan begins as it would give wholesalers and retailers a scope to destabilise the market.

Imports match demand

According to the commerce ministry, the regular monthly demand for edible oil in the country stands at 1,50,000 tonnes, which escalates to 3,00,000 tonnes during Ramadan. 

Similarly, the monthly sugar demand is 1,50,000 tonnes, doubling to 300,000 tonnes during the fasting month. 

Chickpeas see an annual demand of 1,40,000 tonnes, with the highest demand of 100,000 tonnes occurring during Ramadan. 

The annual demand for dates is around 90,000 tonnes, with 40,000 tonnes required during Ramadan alone, as evidenced by the import of 33,541 tonnes from December to February. More imported dates are on the way.

Why are prices high despite ample supply?

Importers said despite sufficient imports, consumers are facing higher prices this year compared to last year due to factors such as the rising dollar price, increased LC margins (up to 150% in some cases), and elevated business operation costs. 

Among Ramadan essentials, dates have seen the most significant price hike, attributed to higher customs assessment values and import duties this year. 

While last year, chickpeas were priced at Tk80-90 per kg, this year, despite sufficient imports, prices have risen slightly due to the dollar's exchange rate, with chickpeas now selling at Tk100-110. 

Similarly, sugar prices have surged to Tk142-145 per kg at retail, compared to Tk110-115 last Ramadan. 

However, there has been a decline in edible oil prices, with bottled soybean oil now priced at Tk160-165 per litre, down from Tk180-190 last year, attributed to ongoing reductions in the international market.

Consumer goods trader Azizul Haque, owner of Haque Trading in Chattogram, attributes the price hike to a market scenario where a handful of importers hold sway over the entire consumer goods market. 

"Big traders are procuring and hoarding products from these importers, creating a monopoly that drives up prices domestically, despite reductions in international market prices," he said.

However, City Group's Deputy General Manager (Sales) Prodip Karon said despite global price decreases, import costs have risen by 20-30% due to higher exchange rates and LC margins. Moreover, increased government duties on many products have further elevated prices beyond previous levels.

SM Nazer Hossain, vice president of the Consumer Association of Bangladesh (CAB), said traders typically raise prices during Ramadan, noting that this year, prices for items like chickpeas and dates are higher compared to the previous year. 

He urged the government regulatory bodies to actively monitor and ensure that products are sold at fair prices in the market.