KARACHI, Nov 21 Consumers are paying high price for toilet and laundry soaps despite a sharp drop in prices of raw material used in the making of soaps in the world market.

Soap manufacturers said they were facing problems in passing the impact of falling raw material prices onto the consumers owing to bottlenecks created by the Customs.

In the current year, the makers of toilet and laundry soaps surged the prices sharply owing to soaring prices of raw materials. Besides, the rates of washing detergent powders have also risen substantially during the same period.

A random market survey shows that Safeguard soap now carries a price tag of Rs38 as compared to Rs26 earlier this year, while another pack sells at Rs26 against Rs16.

Palmolive soap now sells at Rs38 as compared to Rs22, while Capri soap is available at Rs35 as compared to Rs26 earlier this year. The Lux soap is priced at Rs35 as compared to Rs24, while its medium-size pack is selling at Rs25 as compared to Rs16. Dettol soap is selling at Rs38 as compared to Rs26 earlier.

A cake of Sufi laundry soap sells at Rs22 as compared to Rs15 earlier this year. Similarly, the one kg Surf Excel washing powder is now available at Rs220 against Rs150, while retailers warned of further increase in its price to Rs240 from next month. There has been frequent increase in prices since May this year.

The one kg pack of Brite washing powder is available at Rs190 as compared to Rs145, while Ariel`s one kg pack sells at Rs230 as compared to Rs150.

Chairman and CEO of Unilever Pakistan Limited Ehsan Malik said the soap was made of vegetable oil, whilst detergents use materials extracted from mineral oil. In the last 18 months or so cost of both these items rose sharply and this was compounded by the devaluation of the rupee, higher utility costs and wages. This impacted conversion cost and increased transportation cost that affected delivery, he added.

He said it was true that of late the international cost of oils has declined, but the rupee is still down about 27 per cent against the dollar on a year ago.

Just as there was a delay in passing on the increase in raw material, conversion and delivery costs to consumers, there will be a lag between the landed costs coming down and previously purchased stock being consumed before the lower costs are reflected in new pricing, he said.

Ehsan Malik said that the soap and detergents` is a highly competitive market and no operator can afford to fix an uncompetitive price. Most of the players are still sitting on the previously purchased expensive raw materials.

Chairman Pakistan Soap Manufacturers Association (PSMA) Tanvir Ahmad Sufi told Dawn from Lahore that the manufacturers were still clearing the raw material at higher rates. The Customs has been creating problems by still assessing the old import value of raw material despite sharp decline in their prices worldwide.

He said that the price of tallow has declined to $550-650 per ton from 1,100-1,200 per ton few months back. Similarly, the price of palm acid oil has plunged to $450 from $600, while coconut oil rate has fallen to $800 from $1,100-1,200 per ton.

The association has taken up the matter many times and the Customs is taking too much time to resolve the issue. “The price will definitely come down as soon as the imported raw material is cleared at reduced rates by the Customs,” he added.

Tanvir Sufi said that the price of laundry soaps has declined by Rs2 to Rs4 per kg and it may further decline by same rate. However, he added that the multinational soap makers have not reduced the rates.

He said the toilet soap production in the organised sector ranges between 150,000-200,000 tons per annum, while laundry soap production hovers around 400,000-450,000 tons per annum.