KARACHI: In spite of a downward trend in the price of importing palm oil, producers of branded ghee and cooking products have increased their pricing.
According to a vendor, branded cooking oil and ghee now cost Rs570 per kg/litre, an increase of Rs80. He went on to say that some major manufacturers have raised their prices by up to Rs100 per kg/litre.
Pakistan Vanaspati Manufacturers Association (PVMA) Chairman Sheikh Umer Rehan explained the price discrepancy to Dawn, saying that palm oil prices, which had risen to $1,285 per tonne on the global market, had since dropped to $1,185, lowering the open market price from Rs19,000 to Rs16,500 per maund.
He continued by saying that small and medium-sized businesses that held a significant portion of the market saw a decline in prices of Rs40 for cooking oil and ghee, which had increased by Rs80 per kg/litre.
He claimed that because of their printing, distribution, and marketing networks, branded products—primarily TV commercial brands—with a 5 percent market share typically take longer to change prices. “The cost of cooking oil and branded ghee would also gradually decline,” he continued.
Ten percent of Pakistan’s palm oil comes from Malaysia, while ninety percent is imported from Indonesia. Five million tons of cooking oil and ghee are consumed annually, of which 3.5 million tonnes of palm oil are imported.
In comparison to 1.248 million tonnes ($1.17 billion) during the same period last year, the nation bought 1.319 million tonnes ($1.26 billion) of palm oil during 5MFY24. During the aforementioned time, the average per tonne price (ATP) increased from $941 to $954.
According to Mr. Rehan, on Thursday, a group of PVMA members met with Herman Hardynata bin Ahmed, the consul general of Malaysia, and asked him to advocate that the Malaysian government lower its export taxes on palm oil for Pakistan.
According to him, the reduced duty will enhance the business climate between the two nations under the Free Trade Agreement (FTA) and contribute to an increase in imports of palm oil.
Under the FTA, Pakistan offers a 15 percent duty discount, but Malaysia does not match Pakistan’s exports with a comparable waiver. In order to promote trade and collaboration, he encouraged the Malaysian government to make a comparable concession.
Herman Hardynata, the consul general of Malaysia, gave the participants his word that Malaysia will examine PVMA’s recommendations to enhance infrastructure for the import of palm oil and boost commerce. In an effort to grow the palm oil sector in Pakistan, he also stated Malaysia’s readiness to work with PVMA on palm oil plantation projects in interior Sindh.
