Oil shortages again dampen TCB sales

June 14, 2022, 11:20 a.m.

Last modification: June 14, 2022, 1:09 PM

What is the current price of soybean oil, after continuously rising prices for more than a year? Photo: Mumit M

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What is the current price of soybean oil, after continuously rising prices for more than a year? Photo: Mumit M

The Trading Corporation of Bangladesh (TCB) has postponed sales of basic necessities to 1 crore poor families at subsidized rates from June 16 as edible oil mills failed to supply required soybean oil to the government , according to officials.

For subsidized sales, state-owned TCB in May asked factories to supply 2.50 million liters of soybeans at Tk192 per litre, less than the retail price of Tk198 at the time. But the millers did not respond to this.

They have now agreed to supply the oil after the Commerce Ministry raised the price of edible oil on June 9.

Although it is not yet finalized when TCB sales would start, TCB Chairman Brigadier General Md Ariful Hassan told The Business Standard that 1 crore poor families will get essentials before Eid-ul-Azha , the second largest Muslim festival to be celebrated in the second week of July.

TCB sales were scheduled to begin June 16 and run through June 30. Previously, the company announced that sales in the capital would begin on May 16, but suspended them at the last minute.

Commerce Ministry officials said the government would distribute 2 kg of lentils, 2 liters of soybean oil and 1 kg of sugar at subsidized prices ahead of Eid-ul-Azha to every family that has a family card.

As the millers refused to supply oil at Tk 192 per litre, the TCB then readjusted the offer price to the maximum retail price of Tk 198. But factories only accepted the move on Wednesday last week, saying they had already negotiated the price hike with the government.

On Thursday, the Ministry of Commerce raised the price of bottled soybeans to Tk 205 per litre. Then the mills agreed to supply oil at the factory rate of Tk 195 per litre. But the offer has not yet reached the TCB.

TCB needs 2.50 crore liters of edible oil. At present, it has a stock of 21 lakh liters, which can only meet 10% of the demand.

In the wake of uncertainty over the supply of soybean oil, the company was advised to buy rice bran oil by the Ministry of Commerce. The company is buying 5,000 tonnes of oil directly from rice bran mills in the country.

The company informed the Ministry of Commerce that it had 20,000 tons of lentils and 10,000 tons of sugar in stock, which was enough to meet demand.

In a letter to the Department of Commerce on June 8, the company expressed concerns about the successful implementation of subsidized sales due to complications with edible oil supply.

Earlier, Commerce Minister Tipu Munshi explained to reporters the suspension of TCB sales from May 16. He said the sales would start after the family cards for the poor in Dhaka and Barishal are prepared.

Previously, anyone could buy edible oil and other essentials from open truck sales. However, only family card holders will now be able to purchase subsidized products during the special food drive.

Sallie R. Loera