Soybean oil disappears from market ahead of Eid

Azizur Rahman, an iftar food seller in the Merul Badda area, has been struggling to find soybean or palm oil for the last few days. Even when he could manage to find edible oil, he had to pay Tk20-25 extra per kilogram.

On Friday, he visited at least around 10 shops, but could not find bottled or unbottled soybean oil anywhere. When he found unbottled soybean oil in a shop at last, he had to pay Tk190 per kg, which is way more than the price fixed by the government.

Azizur Rahman told The Business Standard, "I would have sold iftar for one or two more days, but because of the oil crisis, I am going to stop it today."

Despite the government's assurance that there will be no shortage in the supply of edible oil during Ramadan, a crisis has hit consumers, retailers and wholesalers in Dhaka just before Eid.

Soybean and palm oil are available in small quantities in only a few shops in the market, while most stores have no oil at all.

The crisis of soybean oil in the retail shops escalated gradually and expanded to the super shops across different areas, including Moghbazar and Dilu Road, in the city.

Visiting a Shwapno super shop outlet in Hatirjheel Mahanagar project at 12 pm yesterday, our correspondent found that there were only five 1-litre soybean oil bottles on their shelves, which usually remain filled with one-litre, two-litre, and five-litre bottles. The outlet had only a few bottles of sunflower and rice bran oil.

A number of sellers said there was a high demand for soybean oil since yesterday morning and so all the bottled oil they had was sold out. Moreover, they could not get any supply from the oil manufacturing companies, which deepened the crisis.

Sajib Ahmed, owner of the wholesale shop Bengal Oil Store in Karwan Bazar, told TBS that the companies were not supplying oil owing to which there was a shortage of the product in the market.

Rifat Hossain, a retail shop owner in Karwan Bazar, said, "I could not find even one-fourth of the amount of oil I usually sell each day. That is why I have stopped selling it."

"If there is no edible oil before Eid, buyers will suffer severely," he added.

However, the edible oil processing and marketing companies claimed that they have maintained a steady supply of the product.

City Group director Biswajit Saha told TBS, "We are supplying oil regularly."

Earlier, at the end of last February, the government rejected the oil marketing companies' request to increase the price of soybean oil. Later, traders cut off oil supplies, citing a rise in prices in the international market. Consequently, retailers ran out of oil and consumers in Dhaka suffered due to the shortage for days.

Despite the efforts of various government and non-government quarters, it took more than 15 days for this crisis to be completely resolved.

At the time, the government reduced the oil price by reducing VAT at different stages. It fixed the price of a one-litre bottle of soybean oil at Tk160 per litre and a five-liter bottle at Tk760. It also fixed the price of unbottled soybean oil at Tk143 and palm oil at Tk130.

After that, the market remained stable for around a couple of months, but a similar crisis has now returned to the market. As a result, consumers are suffering from the shortage of edible oil. Many people are buying mustard or rice bran as an alternative.

A price hike in the international market has also contributed to the latest crisis. Soybean and palm oil prices have skyrocketed since Indonesia announced a halt to palm oil exports a couple days ago. Currently, soybean oil is selling at around $2,000 and palm oil at around $1,800 per tonne in the international market.

Once again, companies involved in oil processing and marketing want to increase prices in line with the international market. They are therefore creating pressure on the government by reducing the supply, said relevant sources.

AHM Shafiquzzaman, director general of the Directorate of National Consumer Rights Protection, told TBS, "Oil processing companies still have reserves sufficient to meet demand for about a month and a half. So there is no chance of a crisis. We will resolve the issue quickly."