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Persistent Decline in Oilseed Prices Despite Reduced Production

“Explore the current challenges in Pakistan’s edible oil market, where lower production and falling prices impact local farmers. Discover the reasons behind the price decline, potential market trends, and the future outlook for edible oil in the country.”

Persistent Decline in Oilseed Prices Despite Reduced Production

Edible oil is the second most important thing that Pakistan buys from other countries. This makes it very important to grow oilseed crops in the country.

Even though last year was good for farming, the prices for oil have gone down this year. Because of this, farmers are not growing as much, especially because they are growing more wheat instead. But even with less oil being produced, the prices are still not going up.

In places like Bahawalpur, Bahawalnagar, Okara, and Chichawatani, the prices for mustard are around Rs. 6,500-6,000 per maund. In Rahim Yar Khan and Layyah, the prices are Rs. 6,000-6,200. These prices are lower than last year, which was above Rs. 7,200-7,500 per maund in December.

A person who knows about the market said that usually, November and December are good months for growing this crop. But this time, the prices are low because the government is being strict about stopping illegal trading, and the international prices for Palm Oil have also gone down in the last few weeks.

He said that if people and buyers understand that there is not much oil being produced, they might start buying more, and the prices could go up in the next two months. But, apart from that, it’s not likely that the prices will go up.

The prices of CPO Futures, which is a way to buy oil in the future, have gone down by more than 20 percent since the beginning of the year. This happened because other countries like India and China are making more vegetable oils, and they have a lot of oil in stock.

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Experts who watch the market, like Fitch Ratings, think that this trend will continue in 2024. This could also affect the prices in Pakistan.

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