A worker at the Amay Htwar peanut oil factory in Insein township fills a bottle with oil. Pic: Aye Zaw Myo

PEANUT oil prices began decreasing in late May after three successive months of increases, and it is likely to continue falling in coming months, say traders at Yangon’s Bayintnaung Commodity Trading Centre.

Cooking oil, one of the staple ingredients in Myanmar diets, reached record peaks in late March and in May, immediately after Nargis, causing concerns for suppliers and consumers alike.

In early May, 1 viss (1.6 kilograms or 3.2 pounds) of peanut oil cost K7500, while palm oil was K4200.

“Prices started decreasing from the last week of May because raw peanut prices were declining,” said U Hla Soe, a peanut oil trader at the centre.

He said a healthier supply of raw peanuts into the market helped to push prices back down and increased oil supply at the same time, adding that peanuts are normally harvested from Upper Myanmar and Rakhine State.

“We normally buy the majority of our raw peanuts from Upper Myanmar but production from Rakhine State this year was high and the quality was good too,” U Hla Soe said. “Because the quality of these nuts was good, we could use them – just like those from Upper Myanmar – to produce oil,” he said.

U Hla Soe said it was lucky that Rakhine produced a better-than-average crop because Upper Myanmar’s harvest was less than expected.

“There were fewer raw peanuts available after a poor harvest in Upper Myanmar but healthy harvest from Rakhine amply compensated for this before the October harvest time arrives. Otherwise, peanut oil prices might well have risen even higher,” he added.

On June 3, peanut oil was selling for K4800 a viss, down from K5100 in mid May while a viss of raw peanuts sold for K1800, down from K2200.

“Although prices are decreasing at the moment, they have not yet returned to normal levels. But it’s still a good sign for consumers,” said Ma Moe Moe Nwe, the sales representative for Ayeyarwady Peanut Oil Production in Bayintnaung, adding that sales were lower than normal.

At the start of the year a viss of peanut oil was K4300 a viss.

“Normally about 15 to 20 barrels (115-viss or 184kg) of peanut oil are sold daily at my shop but now it’s only five or six,” she said.

“I think people are reducing their daily costs because they have to focus on their children’s needs at the start of the school year,” she said.

“But I hope sales will rebound in the coming weeks.”
Traders at the centre also said imported palm oil has decreased in price since last month.

Palm oil retailed for K3500 a viss on June 4, down from K3850 during the last week of May.

“Palm oil prices have dropped because trading and shipping is back to normal, which is helping to force domestic prices down,” said one importer at the centre
One customer said the decrease in costs is helping consumers.

“Recent decreases in cooking oil prices are helping to relieve the higher daily commodity prices, especially for staples. But even though cooking oil prices have dropped to K4800 a viss, it’s still K1000 higher than at this time last year,” said one customer at the Maydarwie market in North Okkalapa township.