Sugar market heats up

After an announcement about the increase in retail price of sugar produced by state-owned mills, the prices of sweetener have soared in the domestic market.

However, the government backtracked on its decision to increase the sugar prices by Tk 20 per kg within hours after its announcement.

Bangladesh Sugar and Food Industry Corporation (BSFIC) issued a notification on Thursday, fixing the maximum price of sugar at Tk 160 per kg, up from Tk 140 earlier.

At some wholesale shops, the price of sugar has increased by Tk 300-350 per 50-kg bag since Friday, the day after this notification. However, BSFIC withdrew the notification on Thursday.

The Ministry of Industries in a press release on Thursday night said, “The government has withdrawn the decision to increase the sugar price, considering the sufferings of the people and the holy month of Ramadan.”

According to Directorate of Agricultural Marketing, the wholesale price of sugar was Tk 133.44-134 per kg last Thursday. But the price increased by Tk 6-7 to Tk 140 per kg in the kitchen market on Saturday.

In many markets, sugar was sold at Tk 135 per kg at retail level on Thursday. It was sold at Tk 140-145 per kg on Saturday.

Retailers in and around the capital said that they bought sugar at Tk 6,650-6,675 per bag on Thursday, but wholesalers were asking for Tk 7,000 on Saturday.

As a result, many retailers returned without buying sugar. They say that it is not possible to buy sugar at high price and sell it at retail. If the price falls again, they have to suffer losses, according to them.

Many traders say that if retailers do not buy sugar, the market will become more volatile due to reduced supply.

A retail trader in Narayanganj, preferring anonymity, told The Business Post over mobile phone that the price of sugar has increased by Tk 300 per sack (50 kg) since Thursday. “I have stopped buying sugar as wholesalers in the market are asking higher prices.”

Mostafizur Rahman, a seller at Segunbagicha market in the capital said, “I am selling sugar at Tk 135-145 per kg. I am asking lower or higher prices based on my customers.”