After rice and wheat, edible oil and sugar are the country's most essential consumer goods. While they are considered second in importance, these two products significantly influence the overall market for consumer goods. Recently, the prices of sugar and edible oils have been rising abnormally. In just a month and a half, the cost of palm oil has increased by BDT 18 per liter, and sugar has risen by BDT 7-8 per kilogram. Importers attribute this to global price increases despite improvements in the dollar and banking sector issues related to the import process. Businesspeople are also pointing to political changes as a contributing factor.

Upon investigation, it was found that just a few months ago, importers were struggling with high dollar prices and difficulties in opening letters of credit. With relaxed LC margins and the dollar exchange rate being at a manageable level, the import crisis has significantly eased. However, taking advantage of global price increases, the prices of sugar and edible oils are rising uncontrollably in the domestic market. Businesspeople believe that the wholesale market has become unstable due to the tariff commission not revising the prices of these two products in the past four to five months.

When asked about this, the chairman of the tariff commission, Dr. Moinul Islam, told Bonik Barta, “We have received several pieces of information regarding the prices of edible oils. We have already started working on this. Decisions will be made based on domestic and international market data analysis.”

When the prices of essential goods rose abnormally, the previous government controlled this by cutting various import duties. However, due to protests and political instability in the country, the Ministry of Commerce did not make any decisions regarding the edible oil or sugar markets. While importers have requested adjustments to the prices of edible oils, this has not been implemented. As a result, packaged soybean oil and sugar are still being traded at previously set prices, while loose sales are happening at the prices determined by importers. Over the past month and a half, palm oil prices have increased by nearly BDT 700 per maund (37.32 kg), and sugar prices have gone up by more than BDT 200 per maund.

Biswajit Saha, Director of Corporate and Regulatory Affairs at City Group, one of the country's major edible oil and sugar importers, told Bonik Barta, “A month ago, palm oil bookings were just under 900 dollars per ton. Currently, bookings have risen to 1080 dollars. As a result, the price of palm oil has surpassed that of soybean oil. The sugar market has also increased significantly so that prices will rise according to market dynamics. Importers bear no responsibility for this.”

An international market analysis shows that on September 17, the booking price for Malaysian palm oil was 3752.6 ringgit per ton. By Wednesday, it had risen to 4070 ringgit. This means that the booking price for palm oil has increased by 318 dollars within three weeks. Meanwhile, on September 10, the booking price for raw sugar was 18.54 cents per pound. However, the latest booking price yesterday rose to 23.24 cents per pound. As a result, the wholesale price of sugar in the domestic market has increased by nearly BDT 200 per maund, trading at BDT 4550. Businesspeople are concerned that the sugar market will continue to rise due to the recent rise in temperatures and insufficient supply to meet demand.

Although booking prices in the global market have increased, wholesale traders in the country consider the rapid price hikes in the domestic market to be unreasonable. They claim that the price of palm oil on the global market was meager just two weeks ago. However, importers are taking advantage of the recent price increases to make extra profits. Additionally, even at the current prices, there is an opportunity to sell imported palm oil for under BDT 5000 per maund, yet it is being sold in the wholesale market for BDT 5500 per maund. As a result of the rising palm oil prices, soybean oil prices have also increased by BDT 200 per maund over the past week, trading at BDT 6100.

The country's primary wholesale market for consumer goods is Khatunganj, which supplies nearly 50 percent of products to markets nationwide. After the political changes on August 5, the wholesale market became somewhat stagnant, but once transactions resumed, the prices of edible oils soared. At that time, the price of palm oil was BDT 4800 per maund, which has now risen to BDT 5500. While the supply order (SO) price is BDT 5500, retail prices have increased by an additional BDT 200 per maund. Alongside palm oil, super palm oil, and soybean oil, the price of sugar has also started to rise. Traders indicate that the increase in sugar prices is primarily due to higher demand during the intense heat, leading to supply pressures. Last week, the price of refined sugar increased by nearly BDT 200 per maund.

According to wholesale traders, there is only one private sugar mill in Chittagong, namely the S Alam Sugar Mill, and some traders believe that rumors surrounding this mill could also contribute to the rising sugar market. At the end of last week, sugar was traded at the SO level for BDT 4350 per maund, but on Wednesday (September 25), it was transacted at prices ranging from BDT 4520 to 4550. Traders report that prices are rising constantly due to high demand in the market.

When asked, Anwar Hossain Chowdhury, the organizational secretary of the Bangladesh Sugar Dealers Association, told Bonik Barta, “While the prices of various consumer goods, including pulses and spices, are declining in the market, the prices of edible oil and sugar are rising. This is because the supply of these two products does not meet the demand. As a result, prices are increasing according to market dynamics. If supply is not increased through regular monitoring by the market monitoring committee, the prices of these essential goods could become even more unstable.”