The prices of cooking oil and ghee in Pakistan have increased by Rs100 due to a slight surge in inflation. A retailer reported that the cost of branded ghee and cooking oil has risen by Rs80 per kg/liter, bringing the price to Rs570. For some larger brands, the increase is as high as Rs100 per kg/liter.
Pakistan imports 90% of its palm oil from Indonesia and 10% from Malaysia. The country’s total annual ghee and cooking oil consumption is 5 million tons, with 3.5 million tons of palm oil imported to meet demand.
During the first five months of FY24, Pakistan imported 1.319 million tons ($1.26 billion) of palm oil, compared to 1.248 million tons ($1.17 billion) during the same period last year. The average price per ton rose slightly to $954 from $941 in the previous year.
Sheikh Umer Rehan, Chairman of the Pakistan Vanaspati Manufacturers Association (PVMA), said that global palm oil prices had risen to $1,285 per ton but have since settled to $1,185, leading to a reduction in the open market price of palm oil from Rs19,000 to Rs16,500 per mound.
As a result, the prices of ghee and cooking oil, which had increased by Rs80 per kg/liter, have seen a Rs40 drop from smaller and medium-sized manufacturers, who hold the largest market share. Rehan explained that larger, branded products—primarily those advertised on television—represent only 5% of the market and take longer to adjust to price fluctuations due to their extensive printing, distribution, and marketing networks.
