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Bangladesh - April 4, 2022

Soybean turns like liquid gold!

Artificial crisis foils govt bid

Golam Mostafa Jibon: Despite several initiatives of the government, an artificial crisis ofSoybean oil has been created in the market in the beginning of Ramadan. As a result, many are being forced to return home with empty hands as the traders deny selling of Soybean oil with the government fixed rate on the plea of short supply.
Although, the buyersare being able to buy gram, sugar and other daily commodities at higher prices, many are not gettingSoybean oil as per the demand. Someone went to buy a-5-liter of bottle, but got a one- or two-liter bottle of Soybean oil yesterday. Shopkeepers kept Soybean oil bottles decorated in the shop in fear of mobile court, but they don’t sell those in a bid to make stockpile. They are creating an artificial crisis ofSoybean oil in the market with the aim to realize additional prices.
Shopkeepers claimed that, they no longer have oil reserves. Talking to Azad Miah, a grocer in Farmgate area, it was learned that dealers were not supplying Soybean oil as per the demand. If they are giving little amount, that is at a higher price. So it is not possible for them to meet the demand of retail buyers. The rise in prices of essential commodities on the occasion of Ramadan is nothing new in the country. However, this year’s edible oil market seems to have surpassed all past records. The crisis first began with a sharp rise in oil prices. Now the buyers are not getting Soybean oil even after paying higher prices.
Many said making fun that Soybean has now turned like bottled liquid gold! Buyers are being delighted after getting it on hand. Those, who are being failure to gain it, feeling unhappy during the Ramadan.
Nobaran Hossain, a resident of Khilgaon area of the capital went to Khilgaon kitchen market yesterday to buy five liters of Soybean oil, but he returned after buying two liters of oil. Meanwhile, Samad Ali, who works in a private company, went to Badda market to buy some goods on account of Ramadan. But he got annoyed as he could not buy Soybeanoil at the government fixed price.
“Grocers are realizing Tk 15 to Tk 20 additionally against per liter of bottled Soybean oil. If I purchase five liters of Soybean bottled, I have to spend additional Tk 100 against it,” he said.
He said, the government has declared that the country has adequate stocks of goods including Soybean oil. But the problem is, the prices of all commodities are high compared to the real prices. Consequently, poor people suffer immensely. He further said angrily, “I used to see that prices would go up when Ramadan came. Now the strategy of the traders has changed. One or two months before the arrival of Ramadan, the price has increased almost 4 times. But the price neverreduces.
Many buyers complained that, Soybean bottles have gone disappear from many shops. They have created manmade crisis with a hope to realize additional money.
While talking, many shopkeepers said, if they sell Soybean oil with the government fixed price, they will incur losses. That is why,traders are not selling oil. Due to this, there has been some crisis in the oil market.
Soybean oil is now being sold with additional Tk 15 to Tk 20per liter against the price fixed by the government. Depending on the brand, one liter of bottled Soybean oil is being sold at Tk 170 to Tk 180. Five liters are being sold at Tk 780 to Tk 800. Open Soybean oil is being sold with almost same price.
However, in order to control the price of edible oil without any restraint, the government has lifted all the VAT on the import, refining and sale of edible oil by keeping only 5 percent VAT at the raw material import level last month. So far, 35 percent VAT has been levied on edible oil in three levels. Later on March 20, the Bangladesh Vegetable Oil Refiners and Vegetable Manufacturers Association announced a new price by reducing the price of Soybean oil by Tk 8 per liter in a meeting with the Ministry of Commerce. According to the announcement, open Soybean oil is to be sold at Tk 136 per liter, bottled Soybean oil at Tk 160 and a five-liter bottle of oil at Tk760.
Meanwhile, a or two week ago, the price of edible oil went below the price fixed by the government, but now it has started rising again in the wholesale market.
Wholesalers said, the market was volatile as no new supply orders came from the factory.
Soybean oil was sold at Tk 144.80 per liter in the wholesale market yesterday. This price is Tk 8.5 more than the retail price fixed by the government. Even after the government reduced VAT, the buyers have to buy edible oil at a higher price this time than last time.
According to the Trading Corporation of Bangladesh (TCB), the price of a liter of Soybean oil last year was Tk 115. This time even after reduction of VAT, a liter of Soybean oil is being sold between Tk 170 and Tk 180. In other words, the price is still over 20 percent higher than last time. The Center for Policy Dialogue (CPD) Honorary Fellow Mostafizur Rahman said, “The market should be monitored regularly to ensure the benefits of price reduction. No one can take extra advantage, if there is supervision.”
He added that there is instability in the world market. In the future, it is necessary to keep an eye on the import of daily necessities. If necessary, the government will have to take new steps to increase supply.

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