Express (August 21, 2011)
Bangladesh refiners have the capacity to export edible oil after meeting the entire local demand of some 1.4 million tonnes a year, industry sources said on Saturday.
They are capable of refining 3.5 million tonnes of edible oil of which 75 per cent are for palm oil, 20 per cent for soybean oil and the rest 5.0 per cent for mustard oil, they said.
Myanmar and the northeastern states of India have a large demand for edible oil refined in Bangladesh. In absence of formal trade deals, a large quantity of such oil are now smuggled out, they said.
Police and Bangladesh Border Guard often seize outbound smuggled refined edible oil, along the borders with Myanmar and India, the police said.
There are some 100 refiners in the country
including 20 bigger refineries, of whom only two can refine 1,000 tonnes each a day while two others can produce 700 tonnes a day, said a senior official of Malaysian Palm Oil Council (MPOC)
"The country imports some 1.4 million tonnes of crude palm and soybean oil annually," said AKM Fakhrul Alam, country manager of MPOC.
Bangladesh also produces some 100,000 tonnes of soybean oil seeds per annum, in addition to some 70,000 tonnes of mustard seeds, officials of the Agriculture Extension Department said.
Lack of concerted planning and cooperation between the refiners and the relevant authorities including the banks often creates a stalemate in production and supply of edible oil in local market, sparking a furor, analysts said.
Such a stalemate caused supply disruption, spiking last month the retail prices of edible oil, ahead of Ramadan.
The country imports some 1.4 million tonnes of crude palm and soybean oil annually.
Some 80 smaller refineries in the country are now out of operations due to various reasons including lack of refinancing, refiners said.
"There is no reason for shortage of supply if the inbound capacities of all the refineries of the country is utilized," Fazlul Haque, a leader of trade body told the FE.
The prices of soybean oil shot up to Tk 115 to Tk 125 per kg until the intervention of the authorities which refixed it at Tk 109 after consulting with the refiners.
After this fixation, the prices of edible oil prices have been stabilised now in the market, but in some stray cases retailers have reportedly been demanding higher prices, attributing the cause of it to unexplained supply disruption.
A bottle of five litre was sold at between Tk 590 and 600 on Saturday.
Analysts said there was no import of crude or refined edible oil a month ahead of the Ramadan, when demand, as usual, rose high, because of lack of financing in the wake of depreciation of Taka against the US dollar.
The prices of crude and refined edible oil in the world were $1,170 per tonne for palm oil and $1,300 for soybean oil on Saturday.
Lately, the prices for crude palm oil have fallen from their relative higher level a month before. Still the current market price is double the long-term average price.
Bangladesh's annual import of crude palm and soybean oil remained almost unchanged at 1.4 million tonnes for the last three years, said a senior official of the MPOC
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