Edible oil production should be equivalent to demand
Each country has to keep pace with the international market and adjust the prices of daily commodities. But in this case each country needs to adjust the price considering its own position, economic structure, per capita income, purchasing power. The recent rise in the price of edible oil has created extreme frustration among low-income people. Ordinary and poor people of the country do not understand the international market, they are worried about how much they are getting the product.
In the last two years, many people have fallen victim to financial crisis and extreme poverty. With this, the price of every daily commodity has increased. In one leap, the price of soybean increased by tk. 40 per litre and has been fixed at tk. 198 per kg.
World oil prices have been volatile, with Indonesia's palm oil embargo worsening the situation. However, an increase of 40 taka per litre in a hurry is not a normal thing at all. Life will be a stressful journey. The price of many prepared meals will go up. The government has repeatedly said that there is no shortage of oil in the country.
Extreme artificial crisis of edible oil has become visible before Eid. Many say it is the dealers' manipulation. Dealers have started stockpiling oil in the face of rising oil prices. However, the demand for edible oil in the country is constantly increasing. The amount of oil consumed has increased compared to the past. In the last four years, the consumption of cooking oil per person has increased by about 6 litres.
Per capita consumption of cooking oil has increased by about 40 percent. Not only in the country, the global demand for oil has increased but the production has decreased in comparison. Demand for edible oil has increased several times in Asian countries. In 2020, India accounted for 28 percent of the world's total imported soybean oil. Then there are China, Algeria and Bangladesh. Meanwhile, Argentina and Brazil, the two largest exporters of soybeans, saw their production decline, exacerbating the oil crisis.
There is also instability in the edible oil market due to various reasons including global labour crisis and natural calamities. The impact of international market volatility has also been felt in the domestic market. At present, 95 per cent of edible oil is imported, and this massive import dependence is making the country's market more volatile. However, there are attempts to take various initiatives from the government. The government has plans to increase the capacity of TCB.
The country's importers are in a precarious position due to instability in the international market. Soybean oil prices have risen by 200 dollar per ton following a ban on palm oil exports to Indonesia. Rumours are also responsible for the volatile world market. The market became more reckless due to rumours. The price of edible oil has been rising in the country's market since the beginning of Corona. The increase in prices from time to time makes the consumers unhappy.
With the world market, the country's market is becoming increasingly volatile. In the meantime, Russia-Ukraine war triggers collapse in supplies of sunflower oil from regions that make international markets more critical. The country imports an average of 65,000 tons of soybean oil in crude form every month. There are also three companies that produce soybean oil by threshing soybean seeds. These companies produce an average of 28,000 tons of soybean oil per month.
In all, the demand for soybean oil in the country is around one lakh tons per month. Traders have been reducing imports for some time due to instability in the world market. However, the price of edible oil has been fixed at tk 198 per kg. But there is no reason to think that this price is the end. Prices could rise again at any moment. It is difficult to say when the world market will take a turn. In that case, what should we do? In this case, there is only one way and that is to increase the production of domestic edible oil in line with the increase in per capita consumption of edible oil.
We need to innovate new oilseeds suitable for soil and climate and multiply cultivation. Import dependence must be reduced by increasing the production of edible oil in the country. Mustard was once the main edible oil in the country. At present oil seeds have to be imported. It is necessary to reduce it and make arrangements for production and storage of oil seeds in the country. Mustard, groundnut, sesame, linseed, soybean, gargantil and kusum flowers are some of the oil crops in the country.
At present, only 4% of the country's arable land is used for oil cultivation. The country produces little soybean. In Bangladesh, a person consumes an average of 20-22 grams of oil per day. But the oil crop produced in the country is only 9-10 percent of the demand. So for the time being there is no alternative to oil crop production. Ensuring all other benefits including production and storage of improved oil seeds, use of modern technology, training and motivation of farmers, providing loans on easy terms, supply of all materials has become essential.
It takes only three months to cultivate some varieties of mustard. The production cost of mustard is also less than other crops. No cold storage is required for storage of mustard. Extensive mustard can be planted between aman and boro paddy. Mustard cultivation does not require fertilizer and irrigation like other crops. Mustard contains 40-45% oil and 20-25% protein.
At present, mustard is cultivated in 78% of the oil seed cultivable land of the country. The amount of agricultural land in the country is constantly decreasing and at the same time the amount of oil seed land is decreasing. Production of oil crops is declining due to various reasons including population growth, construction of infrastructure, changes in people's tastes and eating habits. Edible oil is essential in everyday cooking.
Edible oil is also used in making various cosmetics including various pickles, ayurvedic medicine, wax, soap. It is also widely used in hotels, restaurants and bakeries. The annual consumption of oil and fat food in Bangladesh is 3 million 30 thousand tons of which 90 percent is imported. Bangladesh has an internal market of 200 crore dollars for edible oil. In terms of price and quality, palm oil is 55-60% of the edible oil used in Bangladesh.
Aman is cultivated annually in the country in 59 60 lakh hectares of land. Most of the farmers leave the land fallow after harvesting aman paddy. But if mustard can be cultivated at this time, there is a chance to benefit greatly. There is demand for mustard throughout the year and good market price is also available. It will benefit the farmers and the country will benefit.
By increasing the cultivation of mustard, it is possible to meet the shortage of 6 lakh tons of edible oil in the country and it is possible to save four and a half thousand crore taka in foreign exchange. This information did not appear in any general survey. Scientists at the Bangladesh Atomic Research Institute have suggested that. Bangladesh is the third largest importer of soybean oil in the world.
But the good news is that edible oil production is on the rise in the country. Apart from mustard, cultivation of other oil crops should be increased. Otherwise it will be difficult for us to survive in the competition. At the same time market surveillance needs to be massively increased. Although the government fixes the price of edible oil in the country, many times traders and sellers do not want to accept it.
An invisible syndicate wants to control the market and take advantage of them. Producers, wholesalers and retailers blame each other. Some unscrupulous businessmen put undue pressure on the government. However, it is the responsibility of the government to keep the market tolerant by keeping the syndicate under control.
The government knows very well which strategy will control the market. We the common people want to be a little relieved. We want to be a little better after eating. We want to believe that the government will keep a close eye on the issue so that the price of oil is not increased in any way. We want to see the story of Sonar Bangla not only in words but also in reality.
Majhar Mannan, Assistant Professor, B A F Shaheen College Kurmitola, Dhaka Cantonment