People are bearing the brunt of price hikes of soybean oil and sugar on the international market with soybean price soaring to nine-year high.
On top of the already hiked sugar prices, the item on the international market keeps surging further without any sign of calming down.
Amid the volatile commodity markets, Ramadan this year is going to begin in mid-April. The Ministry of Commerce says it is taking preparation beforehand to tackle the Ramadan-centric surge in demands of some items such as onions, oil and grams.
The Trading Corporation of Bangladesh (TCB) under the ministry will double the open truck sales of items with soaring prices.
AHM Shafiquzzaman, additional secretary to commerce ministry, told The Business Standard that TCB plans to double sales of some items compared to previous year so that consumers get a brief relief during next Ramadan.
The ministry says it will send letters to top five edible oil distributors asking additional measures to keep the supply steady.
Commerce ministry also stresses on enough stocks by the TCB ahead of Ramadan, and strengthening market monitoring to ensure enough supply, distribution and to prevent price manipulations. The ministry will also hold regular meetings on market updates.
Initial targets for TCB open truck sales have already been fixed at a meeting chaired by Commerce Secretary Jafar Uddin. The targets include sales of 50,000 tonnes of soybean oil, 25,000 tonnes of sugar, 70,000 tonnes of onion, 10,000 tonnes of lentils, 8,000 tonnes of gram and 500 tonnes of dates.
The TCB usually sells the items in every Ramadan at lower prices than the retails. In Ramadan, prices of those items surge riding on the spiked demands. On top of the regular market trends, price hikes on the international market intensify concerns.
On the international market, refined sugar prices rose 8.20%, unrefined sugar 4.09%, crude soybean oil 46.32%, crude palm oil 37.41%, lentils 55.36% and gram 6.94% in one year.
Soybean oil prices hiked in soybean exporter Brazil and Argentina, while palm oil surged in Malaysia. On the other hand, lentil prices have gone up in lentil exporter Australia while sugar prices edged up in Brazil.
Though public sugar mills in Bangladesh have been shut down, still 38,000 tonnes of the item remain unsold and piled up at the production facilities. Moreover, sugar production in neighbouring India has increased by 25.37% from October last year to January this year which may calm down the prices in the international market.
City Group Director Biswajit Saha told The Business Standard soybean oil prices in the international market edged up to about $1,200 from $700 in six months. Oil bought at this rate will cost customers more than Tk150 per litre.
He called for bringing the current three-tiered VAT (value added tax) on edible oil to a single stage.
Meanwhile, the Bangladesh Trade and Tariff Commission in a report to the commerce ministry has also recommended levying 15% VAT on the taxable 67.67% price of crude soybean and palm oil. Tariff Commission says this will not reduce the government's revenue from this sector, again the price will be capped too.
While contacted, Ghulam Rahman, president of the Consumers Association of Bangladesh (CAB), told TBS, "It is normal for the country to be affected if prices in the international market rise. But the government will have to reign in the soaring prices with policy support if needed. Otherwise, the sufferings of the customers will intensify."