KARACHI: Despite the rupee strengthening against the dollar and a decline in world price of various commodities, prices of ghee, cooking oil, tea, pulses and dry fruits continue to stay on the higher side for consumers.
One dollar now sells at Rs155 as against Rs164 in June 2019 and therefore should be making imports cheaper.
According to the data of Pakistan Bureau of Statistics (PBS), the average per tonne price of palm oil came down to $550 per tonne in 5MFY20 from $631 per tonne in same period last fiscal. However, consumers are left with no choice but to buy ghee and cooking oil at higher prices. Good quality ghee and cooking oil sells at Rs200-230 per kg/litre, showing a jump of Rs20-30 per litre in the current year.
Total palm oil imports in 5MFY20 stood at 1.230 million tonnes, costing $676m as compared to 1.246m tonnes valuing $786m in same period last fiscal.
Soybean oil’s average per tonne price plummeted to $689 per tonne from $747 per tonne. Soybean oil imports in terms of quantity and value were 57,553 tonnes and $39m as compared to 54,895 tonnes and $41m.
Importers urge govt to remove duties and taxes
Talking to Dawn, Member Pakistan Vanaspati Manufacturers Association (PVMA) Atif Rasheed said the price of palm oil in world market has surged to $810 per tonne from $550 per tonne in the last three to four months.
Ghee and cooking oil industry is 95 per cent reliant on imported items including palm oil, palm olienn, soybean oil, vitamins, tin plates, chemicals, etc on which government has imposed duties and taxes. Previous governments used to increase import duty on ghee and cooking raw materials when palm oil in world market used to hover at low prices to avert any revenue shortfall.
“The situation is now different. As world markets are soaring high, the government should cut import duties and taxes on imported raw materials to bring down prices of ghee and cooking oil,” Atif said, adding that sales are depressed now as compared to last year owing to high domestic prices. “People are purchasing ghee and cooking oil as per their demand instead of purchasing in bulk,” he said.
Tea, dry fruits become more costly
Consumers witnessed a jump of Rs 100 per kg in tea prices in the last six months. However, the average per tonne price of tea stood lower at $2,335 per tonne versus $2,679 per tonne but blenders and importers keep tea prices higher. The import bill of tea was $184m on arrival of 78,922 tonnes during the last five months versus 93,444 tonnes valuing $250m.
Prices of dry fruits and nuts are hitting the roof despite the fact that average import price of these items came down to $1,625 per tonne in the last five months from $1,817 per tonne. Total imports in 5MFY20 were 8,989 tonnes ($14m) as compared to 8,656 tonnes ($15m).
A total of $196m were spent to import 415,061 tonnes of pulses as compared to 452,552 tonnes valuing $247m in 5MFY19. The average per tonne price had dropped to $474 per tonne from $547 per tonne.
Price of moong recently hit a record high of Rs260 per kg. Interestingly, all good quality pulses are selling for over Rs100 per kg.
A leading commodity importer and former president Karachi Chamber of Commerce and Industry (KCCI) Haroon Agar said pulses rates in world markets have been going up since November. “Mash price rose to $900 per tonne from $450 followed by increase in masoor pulse to $450 from $370. Local chickpeas and yellow peas prices surged to $600 and $450 from $480 and $370 per tonne in the last two months,” he said.
Moong import is being managed from Burma and Thailand due to low crop while world market rates stand at $900-1,025 per tonne. Gram pulse is also being imported from Australia while local crop is also available. Masoor imports are being made from Canada and Australia while mash pulse is arriving from Burma. He said increasing world price had offset the impact of exchange rate.
According to Economic Survey FY19, gram pulse production had recorded 35.6pc jump to 438,000 tonnes on account of higher yield due to favorable weather condition prevalent at the time of sowing. Masoor stayed unchanged at 64,000 tonnes while moong production fell by 3.4pc to 117,000 tonnes. Mash production dropped by 5.5pc.
In dry fruits and nuts category, legal importers have taken a back seat since almost total arrivals have been finding way into the markets via smuggling.
Published in Dawn, December 29th, 2019