Smriti Sen Gupta
Bangladesh, with a population of 170 million, is a huge market for edible items. Currently, soybean oil, sunflower oil, and palm oil are mostly imported from the USA, Malaysia, Indonesia, Italy, and Spain. On the other hand, dairy products such as powdered milk, butter, and cheese are imported from New Zealand, Australia, Denmark, Switzerland, China, and India. According to the US Department of Agriculture (USDA), soybean and palm oil imports are likely to increase by 10 percent to 2.65 million tonnes in the year ending in June. It is also forecasted that edible oil imports might grow 6 percent year-on-year to 2.8 million tonnes in the next marketing year of 2019-2020, beginning in July.
Although three decades back, majority of the Bangladeshis were mainly depending on mastered oil for cooking purpose, continuing population increase, changing consumer behavior to dine out, increasing urbanization and an increase in bakery and processed food production drives the consumption of both soybean and palm oil in Bangladesh.
With the country producing an insignificant amount of soybean and no palm oil, Bangladesh has to meet the domestic requirement through imports, mostly in crude form. Palm oil accounts for the majority of import and consumption.
Bangladesh spent USD 2 billion in fiscal 2017-18, up 22 percent year-on-year from USD 1.6 billion, according to Bangladesh Bank. The USDA estimates the spike in the import of both soybean and palm oil in the next marketing year on the assumption of increased consumption for home and industrial uses in processed food production.
Bangladesh’s annual edible oil consumption is estimated to grow by 11 percent year-on-year to 28.50 million tonnes in the current marketing year from that a year ago, said USDA Foreign Agricultural Service in its report on the Bangladesh Oilseeds and Products Annual 2019.
Consumption is also predicted to go up next year with the demand for soybean oil rising at a faster pace.
The agency forecasted an increase in soybean acreage and production in the next marketing year.
To Bangladeshi consumers, sunflower oil also is gradually becoming popular. Especially those health conscious people are switching onto sunflower oil from soybean or palm oil.
Farmers living in coastal Bangladesh have always found it difficult to grow oil seed crops because of the soil’s high salinity. Instead, they buy cooking oils for use at home. Following Cyclone Sidr in 2007, many farmers in coastal districts of Bangladesh were given sunflower seeds to plant because these seeds required lower inputs, grew well, could be profitable in saline areas, and were drought tolerant.
Despite growing consumer demand for low cholesterol oils in the last five years, the processing and marketing of sunflower oil remain difficult. Limited availability of sunflower seeds only further constricts the industry. These low levels of production have created market disincentives for both seed companies and processing firms.
A local Bangladeshi company, SUSCO Limited, which has been dealing in edible oil for over a decade is seeing a huge prospect in an increase in the demand of sunflower oil in the country. According to the company sources, once the consumers can be offered sunflower oil at an affordable price, the annual consumption of sunflower oil will also cross at least 2 million tonnes within next one year, which the demand will continue to grow.
According to Daraz, an online retailer network, the current maximum retain the price of sunflower oil is USD 2,769 (Olitalia brand from Italy), while the MRP of soybean is USD 1,162 (any local brand).
The maximum retail price of imported Mozzarella is USD 8,823 per tonnes while the price of butter is USD 9,000-9,500.
Price of ‘Almarai’ cheese triangle (8 pieces) is USD 2.35, Bon Appetit (Australia) is USD 2.88 per 170 grams, KRAFT Cheddar cheese spread is USD 4.47 per 230 grams, Philadelphia crème cheese is USD 6.70 per 250 grams, and Bega gourmet slices cheese is USD 3.41 per 200 grams. Currently, there are most of the international brand of cheese and butter available in the Bangladesh market.
Representatives of SUSCO Trade said they are looking for supply sources from the east European nations, especially Ukraine for the import of sunflower oil, cheese, and butter. They also are interested in importing powdered milk.
The company sources said, Ukraine also can sell Urea fertilizer into Bangladesh market as the annual demand of Urea is 2.5 million tonnes. Almost half of this demand is meted through import.