Bangladeshi sugar market will volatile again

Local sugar market has become volatile again with millers raising prices following the fresh round of increases in the prices of the essential sweetener in international market. Wholesale price of sugar increased by Tk 120 per maund or more than Tk 3 each kilogram in just one-and-a-half week. Retailers have also started responding to wholesale market as, up by at least Tk 4 per kilogram in a week, sugar sold between Tk 52 and 56 on Tuesday. 'Wholesale sugar price is rising almost everyday—we are experiencing fresh volatility in the market,' said Mohammed Ali, a wholesaler at Maulvibazar, the hub of commodity wholesales in the capital. At Maulvibazar on Tuesday ready stock sugar sold each maund (37.3 kilogram) for up to Tk 1, 840, up by Tk 40 in four days and Tk 120 in ten days. Market sources said fresh increase in sugar price in the international market had forced the refiners to raise prices and make a windfall profit. Five private sector refiners, who rely on imported raw-sugar, are movers and shakers of in local market as production in state-owned sugar mills cannot even meet one tenth of the demand. According to a London Commodity Exchange report, increased by $100 per tonne in three weeks, sugar price closed at $ 695 on Thursday when market went to Christmas and New Year holiday Some wholesalers at Maulvibazar in Dhaka and Khatunganj in Chittagong however say despite international prices increased much, prices would not go up this time so sharply, as had happened during Ramadan. Traders say about significant stocks of imported refined sugar, procured by some importers some weeks back, would help to keep the market stable. 'The local market could have also been worsened much if the winter would not keep sugar demand dull,' a wholesaler told New Age. Wholesalers also say that the market should remain comparatively stable as state-owned sugar mills are in operations only in the crushing season (November to May) 'Although their production is very small but a government stock makes a psychological impact on the market,' said one wholesaler. Bangladesh's annual sugar consumption is estimated at 1.2 million tonnes but 15 state- owned crushing mills' current crushing season target is 101,000 tonnes against 75,000 tonnes the previous season. According to the daily market report of the Trading Corporation of Bangladesh, sugar per kilogram was being retailed between Tk 31 and Tk 34 on December 28, last year. Bangladesh's import-dependent sugar market faced a volatility in the middle of this year following a production shortfall in India, and as a result of higher prices in the international market. Costlier by Tk 20 in a month, retail sugar price had hit Tk 66 per kilogram in mid-September, even after the government, in mid-August, had imposed zero tariff on raw-sugar import. Later a government investigation claimed that some wholesalers had instigated such sharp rises in a short period by hoarding and trading the delivery orders [DO] at unduly higher prices.