ISLAMABAD, July 25: The producers of ghee and cooking oil have warned the government of a considerable increase in the prices of vegetable ghee and cooking oil before Ramazan due to high taxes and decrease in supply of edible oils to international market.
“With Ramazan around the corner (in the last week of September), the prices of vegetable ghee and cooking oil are likely to go up further,” Dr Ghulam M. Samdani, secretary of the Pakistan Vanaspati Manufacturer’s Associations, warned on Tuesday.
He told this correspondent that the taxes and duties had reached to Rs20 on a kilogramme of ghee and cooking oil, and needed to be reduced to maintain the prices.
Prices of crude petroleum have touched $77-78 per barrel against $55-60 of last year. Due to this unprecedented increase, not only palm oil but other edible oils such as soybean and rapeseed oil have become attractive alternative for use in bio-diesel and bio-fuel.
Malaysia and Indonesia, major palm oil exporters, have signed an agreement permitting about 16 million tons of palm oil annually as a feedstock for the production of bio-diesel and bio-fuels. Both the countries have set aside 40 per cent of their annual out-put of palm oil for bio-diesel.
As a result, the prices of edible oils for manufacturers of vegetable ghee and cooking oil have increased manifolds. The prices will further rise as newly established bio-fuel plants are becoming operative.
“This trend will definitely jack up prices in the Pakistani market,” Mr Samdani said.
He said some domestic factors had also contributed to the price hike. “For example, increase in freight for imported edible oils due to soaring crude petroleum prices and other related costs, constant raise in utility prices and increasing tax deduction from freight charges.
