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Palm oil wholesale reference price moving onwards

The wholesale reference rate of palm oil in the Yangon market continued to rise at K4,330 per viss (a viss equals 1.6 kilogrammes) this week, according to the Supervisory Committee on edible oil import and distribution. The Supervisory Committee on edible oil import and distribution under the Ministry of Commerce has been closely observing the FOB prices in Malaysia and Indonesia including transportation cost, tariff and banking service, and issuing the wholesale market reference rate for edible oil on a weekly basis. The reference prices of palm oil in the Yangon market were set at K4,330 per viss for this week from 8 to 13 November, and K4,225 per viss for the previous week ending 7 November.

The figure was up by over K150 per viss this week. Despite the reference price, the current market price is rocketing. If those retailers and wholesalers are found overcharging, storing inventory intentionally and attempting unscrupulous action to manipulate the market, they will face legal action under the Special Goods Tax Law, MoC released a statement. The Ministry of Commerce is striving for consumers not to worry over the supply of edible oil. The ministry is also trying to secure edible oil sufficiency, supervise the market to offer reasonable prices to consumers and maintain price stability.

At present, mobile market trucks operated by oil importing companies, in coordination with Myanmar Edible Oil Dealers’ Association, were back to business in some townships on 17 July in order to offer palm oil at a subsidized rate. They sell palm oil at K4,550 per viss to consumers directly. However, there are limited sources of supply although they directly sell palm oil at a reference rate depending on the volume quota. The domestic consumption of edible oil is estimated at one million tonnes per year. The local cooking oil production is just about 400,000 tonnes. To meet the oil sufficiency in the domestic market, about 700,000 tonnes of cooking oil are yearly imported through Malaysia and Indonesia.

Source: The Global New Light of Myanmar

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US dollar exchange rate stable at K3,000 in market

The US dollar exchange rate does not fluctuate these days and Kyat depreciates against the hard currency US dollar at approximately K3,000 on the over-the-counter market, according to local forex traders. The current exchange rate is K2,990 for buying and K3,050 for selling in the grey market. However, the Central Bank of Myanmar (CBM) set the reference exchange rate at K2,100. In order to strengthen the domestic currency in the local forex market, the CBM set the currency trading band at 0.3 per cent for the Kyat to fluctuate between these two specified upper and lower exchange rates for transactions, selling or buying, according to a directive issued by the CBM on 10 August 2022.

Therefore, financial institutions including banks and informal money exchanges set a dollar value of K2,100 for buying and K2,106 for selling. In August, a dollar value hit an all-time high of over K4,500 in the grey market and consequently, pure gold reached a record high of K3.7 million per tical in history. Consequently, the CBM sold dollars at its auction market for the sectors in need, to control the soaring dollar. A total of $443.8 million were sold at an auction rate in 2021 as well. In September 2021, a dollar value hit a peak of over K3,000 in the black market, pushing pure gold up to K2.22 million per tical.

Under the guidance of the Central Committee on Ensuring Smooth Flow of Trade and Goods, the Monitoring and Steering Committee on Gold and Currency Market was formed on 17 December 2021 as gold and currency market stability play a crucial role in the trade facilitation. The objectives of the committee are inspecting and prosecuting market manipulation, checking if there is compliance with payment rules in the domestic market, and proceeding against those unscrupulous traders who intend to interfere with the free and fair operation of the market under the existing laws, by-laws and regulations in line with the official directives, illegal foreign currency holding, illegal trade and taking legal actions against price manipulators. 

Source: The Global New Light of Myanmar