Sugar selling at higher than govt-fixed rate

Traders in Chattogram are failing to comply with the sugar price fixed by the government to control the market even after a month. Currently, the essential product is being sold at a price which is Tk11 per kg more than the price fixed by the government at the retail level.

On 22 September, the government fixed the retail price of loose sugar at Tk84 per kg and packaged one at Tk89 per kg. However, it has been sold at Tk95 per kg and Tk100 per kg respectively.

Traders said that the prices of sugar have been on the rise for more than two months at the wholesale and retail levels.

On Thursday (20 October), sugar price in Khatunganj wholesale market was Tk3,550 per maund (37.32 kg), which was Tk3,250 two weeks ago. That means the wholesale price of this essential product increased by Tk300 per maund or Tk8 per kg during this time.

Neyaz Morshed, a wholesale sugar trader in Khatunganj, said that the prices of sugar in the international market have been declining for more than three months, but the scenario in the domestic market is completely opposite.

"In early August, the wholesale price of sugar was Tk2,750-Tk2,800. But now in only two and a half months the price has increased to Tk3,550. This is very unusual," he said.

Alamgir Parvez, proprietor of Messrs RM Trading in Khatunganj, said that sugar is being sold in the wholesale market at a higher price than the retail price set by the government. "The government has fixed the price of loose sugar at the retail level at Tk84 per kg. But it is being sold in the wholesale market at Tk95.12 per kg."

Traders claim that the importing companies have destabilised the market due to the lack of monitoring by the market authorities.

Pradeep Karan, deputy general manager (sales) of Citigroup, said in this regard, "It is true that the price of sugar has decreased in the international market. However, due to the upward price of the dollar, we have to pay extra money to pay the import price."

"Besides, our cost has also increased due to the rise in the regulatory duty on sugar from 20% to 30% as before. As a result, it has not been possible to reduce sugar price in the domestic market," he added.

However, traders said that in the last financial year, there was a crisis in sugar import which was 4 lakh tonnes less than the previous year. Although sugar import is normal in the current financial year, importers and factory owners have been using the previous year's crisis to destablise the market for the last three months.

According to Chattogram Customs, only 17 lakh tonnes of sugar was imported through Chattogram port in 2021-22 FY. Earlier, in 2020-21 FY, the amount was 21 lakh tonnes.

Mohammad Faiz Ullah, deputy director of Directorate of National Consumer Rights Protection, Chattogram, told The Business Standard, "We are conducting regular operations to control the market. The issue of selling oil and sugar at a price fixed by the government has been prioritised."

"If the wholesale price increases, the government will consider adjusting the retail price. But no trader will be allowed to sell products at a higher price than the price fixed by the government. We will monitor this issue more seriously," he added.

At present, the annual demand for sugar in the country is about 18-20 lakh tonnes.

Once, the state owned mills used to produce 1.5 lakh to 2 lakh tonnes of sugar. However, in the last two years, the production of six of the 15 government sugar mills has stopped, and the production has dropped to 48,000 tonnes and 25,000 tonnes respectively. As a result, the country's domestic sugar production has been fully dependent on private mills.