Bangladesh faces edible oil crisis, prices skyrocket ahead of Ramzan
11 Feb 2025

Bangladesh is currently facing a severe edible oil crisis, with prices skyrocketing and supplies dwindling.

With the month of Ramzan around the corner, concerns have been raised over whether the crisis is genuine or artificially induced.

In a bid to stabilize domestic supply, the government has imposed a 25% regulatory duty on rice bran oil exports under the Customs Act, 2023.

Edible oil prices soar amid supply concerns
Price hike

Despite the government's intervention, industry experts argue that the duty on rice bran oil may not make much of a difference in the wider crisis.

The main concern is fueled by soybean and palm oil pricing and availability.

Consumers in Dhaka and other cities are reeling under skyrocketing edible oil prices, with unpackaged soybean oil retailing at Tk170-175 per liter and packaged ones at Tk175-178.

Retailers and refiners respond to edible oil crisis
Industry reaction

Retailers are blaming these price hikes on decreased supplies from distributors.

On the other hand, refiners have restricted packaged oil availability to prevent losses as local prices don't match global market rates.

The Bangladesh Vegetable Oil Refiners and Vanaspati Manufacturers Association has sought a price adjustment from the Trade and Tariff Commission due to increased import costs.

Global factors and local practices exacerbate crisis
Crisis factors

Notably, global edible oil prices have shot up by nearly 25% amid supply chain disruptions due to adverse weather conditions and geopolitical tensions.

This has made it difficult for traders to keep stocks, weighing heavily on consumers with inflated prices.

Meanwhile, conflicting reports indicate that the crisis may be artificial with officials and refinery owners claiming there is no actual shortage of edible oil.

Import data contradicts claims of edible oil shortage
Import increase

In fact, the Bangladesh Trade and Tariff Commission (BTTC) reported sufficient stock levels, with imports rising by 35% between December 2024 and January 2025.

However, refinery owners admitted at a BTTC meeting that edible oil was being sold conditionally with other products.

This practice has created an illusion of scarcity and uneven distribution of supplies, prompting legal action warnings against those engaging in conditional sales.

Edible oil demand spikes during Ramzan, supplies expected
Demand spike

BTTC data shows annual edible oil demand at 2.3-2.4 million tons, spiking to 3 million tons during Ramzan.

Ships carrying 150,000 tons of edible oil are waiting at Chittagong port to replenish supplies soon.

Refiners report increased supply compared to previous months, with City Group supplying 50,700 tons of edible oil in January 2025, including 22,242 tons of bottled oil—a significant increase from January 2024 figures.