A task force for edible oil price stability was formed on 28 August to steer the high volatility in edible oil prices, according to the Myanmar Edible Oil Dealers Association (MEODA).
The MEODA has been planning to distribute the edible oil at a fairer price to the consumers in the market, as per the notification dated 28 August.
The objectives of the task force are to ensure that shops and traders in regions
and states can buy edible oil at wholesale reference prices and that there is transparency in the public distribution system.
The task force comprises the administrative committee members from the MEODA, representatives from the Union of Myanmar Federation of Chambers of Commerce and Industry and oil importing companies.
The task force aims to steer the volatile market, improve market access for the consumers and meet the consumers’ demand and satisfaction of the end-users in the supply chain.
Six Winner Brothers Co Ltd out of 16 companies that hold palm oil stocks in hands earlier said at a meeting for edible oil price stability held at Bayintnaung Commodity Wholesale Centre on 26 August that it would sell the palm oil as per its own plan. However, it joined the task force on 28 August and highlighted that it would follow the instructions of the task force.
The task force is planning to ensure that palm oil sales at wholesale prices are not higher than two per cent of the net profit margin and retail prices not higher than 10 per cent margin.
The Supervisory Committee on Edible Oil Import and Distribution under the Ministry of Commerce has been closely observing the FOB prices in Malaysia and Indonesia including transportation cost, tariff and banking service, and issuing the wholesale market reference rate for edible oil weekly. The wholesale reference rate of palm oil for the Yangon market was set at K4,155 per viss this week from 28 August to 3 September.
Despite the reference price, the market price is exorbitantly high. If those edible oil retailers and wholesalers are found overcharging, storing inventory intentionally and attempting unscrupulous action to manipulate the market, they will face legal action under the Essential Supplies and Service Act, MoC released a statement.
The Ministry of Commerce is also trying to secure edible oil sufficiency, supervise the market to offer a reasonable price to the consumers maintain the price stability and lessen the consumers’ concern over the possible shortage of palm oil.
At present, mobile market trucks operated by oil importing companies, in coordination with the Myanmar Edible Oil Dealers’ Association, were back to business in some townships on 17 July 2022 to offer palm oil at a subsidized rate. They offer palm oil at a fairer price to the consumers directly depending on the reference price. However, there are limited sources of supply although they directly sell the palm oil at reference rate depending on the volume quota.
The domestic consumption of edible oil is estimated at 1 million tonnes per year. The local cooking oil production is just about 400,000 tonnes. To meet the oil sufficiency in the domestic market, about 700,000 tonnes of cooking oil are yearly imported through Malaysia and Indonesia. — NN/EM
