Ghee/cooking oil prices: Consumers likely to get 'relief'

The government and ghee manufacturers are near a deal for extending "relief" of up to Rs 30 per kg on premium brands of ghee/cooking oil to the inflation-hit consumers across Pakistan.

The negotiations have divided ghee in three tiers i.e. normal brands, popular brands and premium brands.

Well informed sources told Business Recorder that the new notified retail price of economy brands will be fixed at Rs 165 per kg, popular brands at Rs 175 per cent and premium brands like Dalda, Habib and Soya Supreme etc at Rs 185 per kg. However, prices of ghee/cooking oil are expected to be lower in Karachi as compared to other parts of the country.

Giving the details, source said, the retail price of tier -1 ghee was from Rs 165 per kg to Rs 179 per kg, whereas minimum price of tier -2 was Rs 180 to Rs 203 per kg. The retail price of tier-3 ghee was ranging from Rs 203 to Rs 222 kg. This includes, ex-Karachi price, transport margin, wholesale price and retail price.

The prices of edible oil have been divided in two categories. The price of first category was Rs 180 per litre whereas the category two (premium) was Rs 200 per litre

PVMA which met Commerce Advisor, Abdul Razak Dawood a few days back, held a detailed meeting with the Minister for Industries and top officials of Punjab Government to finalise the price reduction notification.

The government argues that prices of ghee/ cooking oil have shown massive increase which needs to be revised down to provide relief to the masses.

The prices of Ghee range from Rs 165 to Rs 215 per kg which shows a difference of Rs 50 per kg. Both sides are weighing different options to fix Ghee/ cooking oil prices. The retail prices of ghee cannot be reduced from ex-mill price of Rs 160 per kg. However, the government is determined to bring the prices down and for this purpose, former Minister for Industries and Production and PTI's second top man Jahangir Tareen has again been brought as a negotiator; he has already played an important role in reaching an agreement between protesting traders and Finance Ministry.

The sources said, the impact of withholding of axle load will be not more than Rs 3 per kg. But the impact of value addition which has been increased from Rs 1 kg to Rs 5, 10 and 15 per kg depending on the cooking oil tier and if the government withdraws this budget measure, it will have an impact of Rs 5 per kg and if impact of axle load and value additions are clubbed, it will be around be Rs 8 per kg.