The Middle East crisis has led to volatility in the edible oil market, with soybean and palm oil being sold above the government-fixed maximum retail price at the consumer level. A visit to several areas in the capital, including Karwan Bazar, Badda, and Notun Bazar, over the past two days revealed such trends. Retailers said the supply of edible oil has declined, leaving them unable to meet demand. Market observations show that prices of loose soybean and palm oil have increased more sharply than bottled oil.
Data from the Trading Corporation of Bangladesh (TCB) indicate that within four days, prices of loose palm oil rose by 6.09 percent, while loose soybean oil prices increased by nearly 4.75 percent. At Khatunganj, one of the largest wholesale markets in the country, prices have surged by BDT 200–350 per maund (1 maund is approximately 37.32 kg) in recent days.
Retailers said they are not receiving sufficient supply relative to demand and are being forced to purchase oil at higher prices. Wholesalers argue that rising global prices and higher fuel costs due to the Middle East conflict have increased import and refining expenses. Besides, imports have been reduced, which is impacting the domestic market.
According to TCB data, on March 1, a five-litre bottle of soybean oil was priced between BDT 920 and BDT 955. Prices had increased by at least BDT 30, reaching BDT 950–955. Prices of two-litre bottles rose by BDT 5, from BDT 385–395 at the start of March to BDT 390–395. Loose soybean oil prices increased by BDT 10 per litre, selling at BDT 185–193, while loose palm oil rose by BDT 6–13 per litre to BDT 163–168. However, a significant gap remains between TCB prices and those observed in retail markets in the capital.
At Bhatara’s Chholmaid area, a small retailer said on Sunday afternoon that a five-litre bottle of soybean oil was being sold for BDT 1,000, a one-litre bottle for BDT 218, a two-litre bottle for BDT 395, and loose soybean oil at BDT 210 per litre. He added that he had no loose soybean oil in stock. Regarding the price hike, he blamed supply shortages, noting that retailers themselves are unable to procure oil at the maximum retail price printed on bottles.
At Al-Amin General Store in Notun Bazar, no soybean oil was available on Sunday afternoon. The shopkeeper said he had no bottled soybean oil in stock and that prices had increased by BDT 10–15 per litre. Similar price hikes were confirmed across several shops in Badda.
In Karwan Bazar, traders reported both price increases and supply shortages. Loose palm oil was selling at BDT 176 per litre, while five-litre bottles were priced at BDT 950 and two-litre bottles at BDT 390. A shopkeeper at Arabi General Store said they were selling five-litre bottles at around BDT 950 and two-litre bottles at BDT 390 in line with government-fixed rates.
Afrozа Khatun, a shopper in Karwan Bazar, said, “Traders tend to raise prices disproportionately whenever conflicts arise abroad. They increase prices more than the impact of the war. People need to eat to survive, and to eat, they need oil. That’s why they are increasing prices as they wish.”
Another consumer, Md Rabbi from Notun Bazar, said soybean and palm oil were unavailable in some shops, while others were charging BDT 20–25 more per litre.
In Khatunganj, prices have risen sharply following the outbreak of conflict in the Middle East. Over the past two weeks, palm oil prices have increased by BDT 350 per maund, with more than BDT 60 added in a single day on Saturday. Soybean oil prices rose by BDT 200 on Sunday.
Global prices of unrefined palm oil have increased since the conflict began. Rising fuel prices globally have also contributed to a gradual upward trend in the palm oil market, along with increases in super palm oil prices.
Trading and DO businessmen said that just two weeks ago, wholesale palm oil was traded at around BDT 5,850 per maund. Following the onset of the conflict, prices rose to BDT 5,920. However, disruptions to shipping through the Strait of Hormuz have further pushed up both international booking rates and domestic prices of palm oil.
In Khatunganj wholesale market, palm oil traded at BDT 6,100–6,140 per maund on Saturday, before rising sharply to BDT 6,200 later in the afternoon. During the same period, soybean oil prices, which had remained stable for a week, rose from BDT 7,130 to BDT 7,200 per maund. Between morning and afternoon on Sunday, loose soybean oil prices jumped by BDT 150 per maund. Super palm oil prices also increased to BDT 6,450. Yesterday, prices rose further, with loose soybean oil increasing by BDT 50 per maund compared to the previous day, super palm oil by BDT 100 and palm oil by BDT 10. As a result, wholesale prices stood at BDT 6,210 per maund for palm oil, BDT 6,550 for super palm oil, and BDT 7,400 for soybean oil.
President of the Bangladesh Wholesale Edible Oil Traders Association, Golam Mawla, told Bonik Barta, “Decisions on edible oil price increase are typically made jointly by the Ministry of Commerce, importers, mill owners, businessmen, and other stakeholders. However, the government has remained preoccupied with other issues in recent months, and that’s why it hasn’t given due attention to the matter. As a result, importers have kept bottled soybean oil prices unchanged while manipulating the loose oil market to raise prices. Alongside fuel oil, unless the government places importance on the edible oil market amid ongoing global tensions, there’s a risk of instability in the market.”
Under existing rules, the Ministry of Commerce reviews global booking rates and the import situation each month before approving price adjustments. However, amid the domestic atmosphere surrounding the 13th parliamentary elections, the interim government did not take any initiative to revise prices. Therefore, despite rising global prices, bottled soybean oil prices have remained unchanged, while weaker regulatory enforcement in the loose oil segment has allowed prices to increase at the mill-gate and wholesale levels.
Importers said that although global prices have risen, businesses were unable to adjust domestic prices in time. Alongside increasing unrefined edible oil prices, the costs of refining edible oil have become higher amid the current war situation. While bottled soybean oil prices remain unchanged, instability has intensified in the wholesale market for loose oil. They also noted that price increases in earlier supply order (SO) transactions have had a significant impact on the retail market.
Speaking to Bonik Barta, Biswajit Saha, director (Corporate and Regulatory Affairs) of City Group, said, “Global booking rates for edible oil have been rising consistently, while both global and domestic energy crises have made the market unstable. Despite this, importers have refrained from raising prices due to Ramadan, the domestic political situation, and the election period. Wholesale traders are increasing prices, leaving importing mill owners with nothing to do.
Despite higher global prices, importers could not absorb the higher prices due to a lack of domestic price adjustment, leading to reduced supply. Many importing companies are still not supplying bottled soybean oil at desired levels, contributing to an artificial shortage in the market. Retailers warn that prices of loose soybean oil will continue to rise under such conditions.
President of the Consumers Association of Bangladesh (CAB), AHM Shafiquzzaman, told Bonik Barta, “The day after forming the government, the commerce minister told reporters that there was sufficient stock and that prices would not increase during Ramadan. Now a war has begun, which is beyond our control. But why should prices rise for items that are already in stock? This is the syndication of businessmen. They are reducing supply to destabilise the market, yet we aren’t seeing any effective government action.”
On Sunday, Commerce, Industries, Textiles and Jute Adviser Khandaker Abdul Muqtadir visited the Khatunganj wholesale market in Chattogram to inspect the situation. He said there is no shortage of edible oil and that an adequate supply exists in the market. He added that there is no reason for panic, although attempts may be made in some retail markets to create artificial shortages, which do not reflect the overall market situation. He also noted that the edible oil market has remained relatively stable during the ongoing Ramadan, describing it as a positive development compared to previous decades.