Manufacturers of branded ghee and cooking oil have increased prices, even as the cost of imported palm oil has shown a downward trend.
According to a retailer, the price of branded ghee and cooking oil has risen by Rs. 80 per kg/litre, reaching Rs. 570. In some cases, prices for major brands have surged by as much as Rs. 100 per kg/litre, reported a national daily.
Explaining the price disparity, Pakistan Vanaspati Manufacturers Association (PVMA) Chairman Sheikh Umer Rehan stated that global palm oil prices, which had previously climbed to $1,285 per tonne, have now settled at $1,185 per tonne. This reduction has brought the local market price of palm oil down to Rs. 16,500 per maund from Rs. 19,000.
As a result, smaller and medium-sized manufacturers, who dominate the market, have reduced ghee and cooking oil prices by Rs. 40 per kg/litre after the earlier Rs. 80 hike. However, branded products, which account for only 5% of the market, have yet to adjust their prices.
Rehan explained that branded manufacturers take longer to reflect price changes due to their extensive printing, distribution, and marketing processes. He assured that prices for branded items would gradually decrease.
Pakistan relies heavily on palm oil imports, with 90% sourced from Indonesia and 10% from Malaysia. The country consumes approximately five million tonnes of ghee and cooking oil annually, requiring 3.5 million tonnes of palm oil imports.
During the first five months of FY24, Pakistan imported 1.319 million tonnes of palm oil worth $1.26 billion, compared to 1.248 million tonnes worth $1.17 billion in the same period last year. The average per tonne price increased slightly to $954 from $941.
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