Source: Ukragroconsult (Ukraine)
The war in Iran and the escalating tensions in the Middle East have negatively impacted the vegetable oil market in Bangladesh. Specifically, trade is experiencing supply disruptions and price instability. This has already led to a 15-20% decline in sales volumes.
Supply Disruptions and Daily Price Hikes
The main reason is the disruption of logistics and supplies. Notably, this affects shipments from Russia, a key supplier of sunflower oil. Rising export duties and transportation difficulties are leading to daily increases in vegetable oil prices. As a result, prices have recently been rising by 1-2 rupees per liter.
Iran War Bangladesh Oil: Additional Demand Pressures
Additional pressure on the market is coming from reduced demand from the food service sector. Furthermore, due to gas shortages and rising energy costs, some establishments are forced to close or reduce their menus. This reduces oil purchases. Consequently, it makes it difficult for wholesale traders to sell their inventory.
Despite the recent slight price decline, market participants note a high level of uncertainty. However, price fluctuations, delivery delays, and limited availability pose risks of further price increases. Additionally, these factors complicate planning for both businesses and consumers.