KARACHI, Oct 15: Ghee and cooking oil manufacturers have finally decided to revise down rates in the local market following a decline in palm olien rates in international market.

A leading packer has already reduced the rate, and others are also expected to follow the suit. The price of a 16kg tin of ghee/cooking oil is now being quoted at Rs1,500 to 1,550 in Karachi instead of Rs1,780 in September and Rs1,820 about one- and-a-half months back. In late July it was being sold at Rs1,900.

Dalda Foods director Inam Bari told Dawn that five and 2.5 litre cooking oil tins would now be available at Rs725 and Rs375, respectively, instead of Rs785 and Rs390. Moreover, five and 2.5 kg ghee tins would be sold at Rs695 and 355 instead of Rs775 and 395, he said.

A pack of five pouches of ghee (one kg each) would be sold at Rs665 in retail as compared to Rs765, and a pack of five pouches of cooking oil (one kg each) would be priced at Rs710 instead of Rs775.

Manpasand ghee 900 grams pouch price has been reduced to Rs560 from Rs670 each.

“Our production with new price tags has already started, and consumers in Karachi will get the new reduced packs in two to three days,” he said.

He said that palm olien rate had declined to $670-680 per ton as against $795 in September. It was $1,000 two-and-a-half months backs while in July it was at its peak of $1,200 per ton.

The local rate of palm oil dropped to Rs2,900 from 3,600 per maund (37.25 kg) in September while two months back, it was Rs4,200.

He added that the rate had been reduced despite the fact that shipment of palm olien at the port, awaiting clearance, had been purchased at $1,200 per ton.

“Customs duty on these Malaysian shipments had been paid at Rs8,200 per ton while duty on Indonesian palm olien is Rs9,100 per ton.

“There is a vast difference in the rupee dollar parity which now stands at Rs81 to a dollar as compared to Rs62 a dollar a year back,” he said, adding the utility charges have surged while distribution cost has also increased after an increase in diesel rates.

Inam said that palm olien rates have fallen owing to its thin demand worldwide as many investors in Europe and America were offloading commodities after recent economic turmoil.

Pakistan Vanaspati Manufacturers Association chairman Abdul Waheed said that in Punjab, 16-kg tin of ghee and cooking oil was now being sold at Rs1,700 as compared to Rs1,880-1,900 in September.

In July, it was selling at Rs2,100-2,200.

He said that the government was still pocketing Rs27 per litre/kg on ghee and cooking in the shape of duties and taxes.

Earlier, the branded packers did not reduce rates immediately in March and two to three subsequent months when palm oil prices had dropped. And they came out with a price reduction very late.

They had increased rates substantially in the last two years, and the government never check the price increase. In September 2006, five-kg Dalda ghee tin was priced at Rs395.