Edible oil supply surges following price hike, consumers unhappy

A day after edible oil prices were officially raised, markets across the country have seen a sharp increase in the supply of soybean and palm oil.

While the availability has improved, consumers expressed frustration over the rising costs.

On Tuesday (April 15), the government approved a Tk 14 per liter hike in the price of edible oil, citing revenue losses from previous tax cuts and volatility in the global market. The hike follows months of back-and-forth between traders and authorities.

This is not the first such increase. In December, despite a reduction in import duties, oil prices rose by Tk 8 per liter, benefiting traders but offering little relief to consumers. The latest hike comes as international soybean oil prices have actually declined — falling to $1,000 per ton in March, down from $1,045 in January, and averaging $1,040 over the past three months. That figure is at least 10 percent lower than in October last year.

Economists argue the justification for the price hike is weak. “We’ve become hostages to a few large importers. The government appears to have surrendered to their pressure,” said Dr Khondaker Golam Moazzem, research director at the Centre for Policy Dialogue (CPD). “Market control measures exist, but they are not being enforced.”

The sudden surge in oil supply has sparked suspicion among consumers. Many believe that traders were hoarding stock in anticipation of the price hike, and are now releasing it at inflated rates.

Experts recommend diversifying the pool of importers to reduce market manipulation by a few dominant players.

While companies are benefiting from higher margins, consumers are left to bear the burden. “Our household expenses are rising. This puts extra pressure on everyone,” said a disgruntled buyer at a local market in Dhaka.