Branded ghee, oil makers raise prices by up to Rs100
KARACHI: The branded ghee and cooking product manufacturers have raised prices despite a bearish trend in palm oil import costs.
A retailer said the price of branded ghee and cooking oil has increased by Rs80 per kg/litre to Rs570. He added that the hike is up to Rs100 per kg/litre in some big brands.
Giving the reason for price disparity, Pakistan Vanaspati Manufacturers Association (PVMA) Chairman Sheikh Umer Rehan told Dawn that palm oil prices, which had increased in the world market to $1,285 per tonne, have later settled to $1,185, thus bringing down the palm oil rate in the open market to Rs16,500 per maund from Rs19,000.
As a result, he added that prices of ghee and cooking oil, which had risen by Rs80 per kg/litre, witnessed a drop of Rs40 by small and medium-sized players, holding major market share.
He said that branded items (TV advertisement brands mainly), which have a 5pc market share, usually take time to adjust price fluctuations due to their printing, distribution and marketing networks. “Branded ghee and cooking oil prices would also drop gradually,” he added.
Pakistan imports 90 pc of palm oil from Indonesia while 10pc arrives from Malaysia. Total annual ghee and cooking oil consumption stands at five million tonnes per annum, for which 3.5m tonnes of palm oil is imported.
The country imported 1.319m tonnes ($1.26bn) of palm oil during 5MFY24 compared to 1.248m tonnes ($1.17bn) in the same period last year. The average per tonne price (ATP) rose to $954 from $941 in the above period.
Mr Rehan said a delegation of PVMA members met Malaysia Consul General Herman Hardynata bin Ahmed on Thursday and requested the envoy to ask the Malaysian government to reduce its export duty on palm oil for Pakistan.
He said the lower duty would help increase palm oil imports and improve the business environment between the two countries under the Free Trade Agreement (FTA).
Pakistan offers a 15pc-duty concession under the FTA, but Malaysia does not reciprocate a similar waiver on Pakistan’s exports. He urged the Malaysian government to provide a similar concession to foster trade and cooperation.
Malaysian Consul General Herman Hardynata assured the attendees that Malaysia would review PVMA’s proposals to improve facilities for palm oil imports and increase trade. He also expressed Malaysia’s willingness to collaborate with PVMA on palm oil plantation projects in interior Sindh, aiming to expand the palm oil industry in Pakistan.
Published in Dawn, December 20th, 2024