Gas-power crisis ripples from food to transport, construction
Powdered milk prices rise by Tk20-120 a kg depending on brand
Highlights:
- Energy and electricity shortages are pushing up production, transport and household costs.
- Prices of essentials including oil, sugar, flour, lentils, milk and eggs have risen sharply.
- Poultry farms are struggling with load shedding, high diesel costs and rising chicken mortality.
- Brands are cutting product sizes while keeping prices unchanged or raising prices.
- Gas shortages are forcing factories to cut production, increasing losses across industries and prices for consumers.
After visiting three shops, housewife Reshma Akter finally found loose soybean oil at Tk195 a litre in Moghbazar, leaving her stunned on Friday.
"Even 15-20 days ago, it was priced at Tk180. Why have you increased it by Tk15?" she asked the shopkeeper. "Ask the company," the seller replied.
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On Saturday, private jobholder Akram Hossain bought sugar at Tk130 a kg from Karwan Bazar. Just three days back, he had bought the item from the same shop for Tk110.
"Everything except rice has gone up by 10-15% over the past 15 days. Fuel for my motorcycle is also costing more, but my salary has not increased," he lamented.
Md Raihan, a shopkeeper at Karwan Bazar, said distributors hiked the price of a 50kg sack of sugar by Tk900-1,000 within a day.
"How can retailers sell at a loss?" he said.
Another jobholder, Rezanuzzaman, was surprised when a CNG driver sought Tk500 for a trip from Elephant Road to Badda, compared with the usual Tk300-Tk350.
"Because of the gas crisis, I cannot operate the CNG for more than six or seven hours a day. I spend hours waiting in queues and still cannot get enough gas. After paying Tk2,000 to the owner, there is almost nothing left for me. So I have no choice but to charge more," three-wheeler driver Haris Mia defended.
The experiences of the consumers point to a broader economic fallout: the gas and electricity crisis is no longer confined to power plants and factories. It is moving through supply chains and reaching consumers.
Bangladesh's energy crunch has intensified after an Excelerate Energy-operated floating LNG terminal at Moheshkhali was hit by a fire in late July and remained out of operation for weeks.
Inadequate gas reduces power generation; power cuts disrupt factories, ultimately hitting consumers.
Essentials now costlier
The government fixed per-litre loose soybean oil at Tk180 and a five-litre bottle at Tk975 on 29 April. But it is now selling for Tk190-195 a litre in some cases.
Five-litre bottles are also facing supply shortages. Palm oil is selling at Tk166-170 a litre, around Tk4 above the government-fixed price.
Refiners, however, say they have not formally raised prices of edible oil.
City Group Executive Director Biswajit Saha said international soybean prices had increased by around $60-70 per tonne in the past week. At the same time, operating costs have increased by 5-10% because of the energy crisis.
"Still, we have not increased prices. But some companies may reduce supplies because of losses," he said.
Loose atta is now selling at Tk45-50 a kg, while packaged atta costs Tk65-70. Loose flour has risen to Tk65-70 and packaged flour to Tk75-85.
Lentil prices have increased by Tk5-10 a kg depending on the variety. Powdered milk prices have risen by Tk20-120 a kg depending on the brand, with some products selling at around Tk960 a kg. Polao rice has risen by Tk50-80 a kg over the past two months.
Md Arifur Rahman Salman, owner of Salman Store in Karwan Bazar, said Teer soybean oil had been unavailable for about a week. "Other oils are also not available according to demand. Distributors have increased prices."
A senior executive of a leading food and essential-commodities supplier said sugar has risen by around $60 and wheat by $60-70 per tonne.
Poultry hit by load shedding
A dozen eggs that sold for Tk130 nearly 15 days ago are now selling for Tk145-150 in Dhaka. Broiler chicken prices have risen from around Tk180 to Tk200 a kg.
Retailers at Karwan Bazar say supplies have fallen as production costs and mortality rise at farms.
Bangladesh Poultry Owners Association President Mosharraf Hossain said hatcheries require uninterrupted electricity for 21 days to hatch chicks.
"We are having to run generators continuously because of the severe electricity shortage. But diesel costs have made this extremely expensive," he said.
"The chickens are dying because of the heat and lack of electricity. We can no longer survive by buying fuel and running generators," he said.
Smaller packs, higher costs
A 300-gram Vim bar that sold for Tk40 about a month ago is now priced at Tk40 for the reduced 275 grams.
Similarly, a 200-gram bottle of Marico's Parachute oil that sold for Tk200 about two months ago has been reduced to 190 grams, while the price has increased by Tk20.
Wheel detergent powder has increased by Tk20 to Tk165 per kg, while Rin by Tk15 to Tk195. Some soap and biscuit brands have also reduced pack sizes, retailers said.
Pran-RFL Group Director (Marketing) Kamruzzaman Kamal said due to load shedding and low gas pressure, factories often remain closed. Raw material prices also increased in the international market.
"Companies therefore have to either increase prices or reduce product sizes simply to survive," he acknowledged.
Construction industry losses mount
The gas crisis has reportedly forced more than 900 textile mills to suspend operations while garments, steel, paper and ceramics factories are operating well below capacity.
Steel factories typically spend nearly 4% of operating costs on gas and electricity. But as production falls, the cost has roughly doubled because factories continue to incur energy-related costs while producing much less.
Suman Chowdhury, managing director of Ratanpur Steel and secretary of the Bangladesh Steel Manufacturers Association, said steelmakers were caught in a double bind.
"Currently, we are incurring a loss of Tk4,000-5,000 per tonne of rod. If this continues, it will become very difficult for steel factories to survive," he said.
Cement manufacturers are also facing a similar squeeze. Industry operators estimate that production costs have increased by at least 10% over the past month.
Highlighting the adverse sides, Mohammad Amirul Haque, managing director of Premier Cement, said, "If the machinery is stopped even once, it takes four to five hours to return to normal operation. We have been facing this problem for the past month, pushing an increase in production cost by 10%."
"But demand for cement is low during the monsoon. We are absorbing the losses. But this cannot continue for long," he said.
Plastic and ceramic manufacturers are also among the hardest hit, with factories operating far below capacity because of inadequate gas pressure.
For businesses, the immediate cost is lost production. For consumers, it is a shrinking household budget.
