Cooking oil shortages have hit the local market, a few days after the Ministry of Trade and Industry published recommended prices for various cooking oil brands, The Nation has established.
Since Monday, many retail shops in cities had run out of locally produced cooking oil, annoying consumers who never anticipated the shortage.
A random survey by The Nation in Mzuzu, Lilongwe and Blantyre on Tuesday established that most retail shops had stocked only imported brands.
In one supermarket in Lilongwe, a group of women was seen inspecting the available cooking oil brands with disappointment.
The situation, according to Oilseeds Producers and Processors Association president Peter Ngoma, is a result of the acute forex shortage, which has made it difficult for producers to access raw materials.
He said in an interview on Tuesday: “The scarcity of cooking oil has nothing to do with the prices announced by government because this was agreed by both producers and the government in view of the removal of value added tax (VAT).
“The fact of the matter is forex scarcity, which has hit the market, is impeding our operations as most of the producers are now operating below their capacity.”
Ngoma was, however, quick to mention that a rise in global prices of raw materials such as crude oil and shipping costs could also induce a rise in local prices.
He said: “In the case of Malawi, prices are exacerbated by the scarcity of forex to timely pay for such imports, thereby escalating the prices further.
“Thus, as long as the global prices remain high, forex remain scarce and the Russia-Ukraine conflict continues, the set prices may be overtaken by such global trends but the cushion to consumers of removing VAT cannot be underestimated regardless of these global trends.”
The situation has in turn affected consumers who are subjected to high prices of the imported cooking oil.
Consumers Association of Malawi executive director John Kapito said on Tuesday: “Most shops have no locally produced cooking oil and we know it is because of the scarcity of forex on the market,” he said.
On the other hand, government’s move to regulate cooking oil prices will also distort the market, added Kapito.
Ministry of Trade and Industry spokesperson Mayeso Msokera said in an interview on Tuesday that with soya beans now available on the market, producers will utilise the same to produce oil.
“To close the demand and supply gap, we are also allowing import licences for cooking oil on the market and our hope is that this will balance the supply and demand imbalances on the market,” he said.
Meanwhile, the Competition and Fair Trading Commission (CFTC) has indicated that it is part of the engagements between the ministry, cooking oil manufacturers and traders.
“The commission will continue to ensure that consumers are protected by conducting market surveillances, shop inspections and conducting various forms of advocacy,” said CFTC spokesperson Innocent Helema.