KARACHI, Feb 26: Branded ghee and cooking oil packers have decided to push up rates of ghee and cooking oil by Rs4.8 per kg for a 2.5kg/litre pack, Rs5 per kg for a five kg ghee pack and Rs6 per litre on five litre cooking oil packs.
This will be the third increase in the prices of ghee and cooking oil by the companies in the last six months due to increase in edible oil prices in world markets.
An executive in a leading ghee and cooking industry said Dalda five litre cooking oil and five kg ghee tin would now cost Rs470 and Rs465 as compared to Rs440 in December, while its 2.5 litre cooking oil tin and 2.5 kg ghee tin would be sold at Rs240 as compared to Rs228.
The five kg ghee pack (with one kg each pack) will be sold at Rs450 as compared to Rs420. Other packers, like Habib, Tullo and others are likely to follow the suit with the same amount of increase.
The packer said the company had already informed its distributors about the price-hike as new price was currently in the final stages of printing.
“Consumers are likely to pay increased rates for ghee and cooking oil by March 8-10 till the completion of all formalities, including printing of new prices,” he said.
General secretary of Karachi Retail Grocers Group (KRGG), Farid Qureishi, said the distributors of various ghee and cooking oil manufacturers have assured that they would supply commodities with new and increased rate tins in the next two to three days.
He, however, said the increase of Rs40 on five kg tins would be an added burden on consumers despite the fact that international palm olein prices are on the decline for the last one month.
He urged the government to look into the matter and take necessary steps to safeguard the interests of consumers.
Ghee and cooking oil packers had increased rates ahead of Ramazan 2006 by four rupees per kg. Before the holy month, five and 2.5 kg tins were selling at Rs395 and Rs205, respectively.
However, the company’s executive recalled that the companies had pushed up rate of ghee and cooking oil by Rs4 per kg/litre in September 2006, Rs5 per kg/litre in December 2006 and Rs5 to Rs6 per kg/litre in March 2007.
He said in September 2006, the rate was increased after four years. He linked the price-hike to the continuous increase in prices of imported edible oil in world markets.
He said it was hard to gauge the actual negative impact on sales of packers in terms of three times increase in prices in the last nine months.
The packer said that the impact of rising edible oil prices was being passed on to consumers of costly December and January shipments, and in case world prices continue to rise, the companies would consider further increase after two months.
He said that the government is eating up Rs22 per kg/litre in terms of taxes and duties if branded ghee price is quoted at Rs93 per kg after the current increase.
While ghee and cooking oil industry pays between 37 and 38 per cent customs duty on raw material import, all other industries pay 25 per cent duty for importing raw material.
Pakistan’s total annual sale of ghee and cooking oil is 2.5 million tons in which the share of loose items is 60 per cent while premium packs of one kg or 2.5 and five kg/litre hold 40 per cent share.
He said that the government should lower the import duty on palm olien so that prices of ghee and cooking oil witness a fall in domestic market.
