KARACHI: Rupee devaluation against the US dollar over the last few days followed by massive increase in diesel rate has started making a negative impact on commodity prices besides jacking up the cost of living.
With the holy month of Ramazan approaching, stakeholders fear an unusual situation in prices of imported finished and raw material in case landed costs continue to crawl up due to losing strength of rupee and a further rise in diesel rates.
Talking to Dawn, CEO Soya Supreme Ahmad Ghulam Hussain said that a 14 per cent rupee fall against the greenback and soaring transportation cost on account of a Rs35 per litre increase in diesel rate had served to cause a jump in ghee/cooking oil prices by Rs50-60 per kg/litre alone, excluding the impact of gas and power tariffs and 50pc hike in the packaging cost.
As traders have old stocks, this increase would be visible in coming weeks, he said, adding that LCs are retiring at Rs270 as against Rs230.
Issues of LCs, clearance of palm oil from port to be discussed with SBP official today
Mr Ahmad pointed out that higher prices would slow down consumption of oil products due to affordability issues of many households.
Former Chairman Pakistan Vanaspati Manufacturers Association (PVMA) Amjad Rasheed said a meeting was scheduled with State Bank’s Deputy Governor Dr Inayat Hussain on Tuesday (tomorrow) to discuss the issues relating to thin clearance of palm oil from the port.
He said the PVMA delegation would also take up the issue of bottlenecks in retiring of LCs and opening of fresh ones.
Mr Rasheed said around 400,000 tonnes of palm oil were lying at Customs Bonded Warehouses while 200,000 tonnes were at the port’s outer anchorage.
Due to thin clearance of palm oil, local palm oil rate in the market has swelled to Rs16,000-17,000 per 40 kg from Rs11,000-12,000.
“We will also discuss with the deputy governor various measures to streamline edible oil clearance to overcome any serious oil/ghee shortage in Ramazan starting from the third week of March,” he said.
Karachi Retail Grocers Group General Secretary Farid Qureshi said retail prices of pulses had crawled up by Rs20-25 per kg after wholesale prices increased.
He said wholesalers had been warning the retailers that “this is just the beginning and the intensity of price hike in pulses will be more shocking for consumers when the imported containers will be opened for market sale after their release from the port”.
He said gram pulse after a jump of Rs20-25 per kg in its price was selling at Rs240-275 per kg depending on the quality followed by moong at Rs280-300, mash at Rs400-450 and masoor at Rs280 per kg.
He feared a deep food crisis situation during Ramazan in various imported commodities in case the prices continued to remain under pressure as the demand for gram pulse went higher than normal days in the holy month.
Former chairman Pakistan Tea Association and FPCCI’s executive committee member Muhammad Shoaib Paracha said a steep decline in rupee value had pushed up the landed cost of imported black tea by over Rs100 per kg.
Published in Dawn, January 31st, 2023