Picture: Collected
The price of palm oil, a key edible oil, has significantly increased in the domestic market over the past month and a half, with wholesale prices rising by Tk850 per maund. Traders attribute this sharp rise to challenges in opening letters of credit (LCs) for imports and higher international booking prices.
In Khatunganj, Chattogram’s main wholesale market, palm oil sold for Tk5,700 per maund on Sunday, up from Tk4,850 in August, a Tk850 jump in just a month. This surge has also impacted retail markets, where palm oil now costs Tk148-150 per litre, compared to less than Tk135 last month.
According to Abdur Razzak, a trader, the price increase began in late August due to importers raising prices. He noted that while there is no palm oil shortage, rising international prices and the suspension of LC facilities for S Alam Group have disrupted the market.
Pradip Karan, a City Group executive, added that LC openings have faced delays since early August, and rising shipping costs have further contributed to the price hike.
Wholesale traders also pointed out that neither the government nor import companies have adjusted edible oil prices for a long time, causing instability in the market. Mill owners have reduced supply orders, leading to an artificial crisis, which has shifted traders towards palm oil despite higher prices.
An unnamed source from an oil company mentioned that the volume of imports has decreased due to banking issues, with the possibility of mill operations halting if stocks run out. In contrast, soybean oil prices have remained stable, with only a small price gap now between palm oil and soybean oil. Soybean oil is currently priced at Tk5,900-5,920 per maund, slightly down from Tk6,000 two weeks ago.
