Cooking Oil Prices Surge in Nepal as Global Supply Chains Face Disruptions

Nepal is experiencing a significant rise in cooking oil prices, with retailers increasing rates by NPR 20 to NPR 50 per liter over the past month. The surge has been attributed to higher international raw material costs, influenced by ongoing conflicts in West Asia. Sunflower oil, which sold for NPR 250–275 per liter at the end of Magh, now exceeds NPR 290 per liter in many private outlets.

The state-owned Food Management and Trading Company Limited (FMTCL), however, continues to sell edible oils at slightly lower prices. On its website, soybean oil is priced at NPR 240 per liter, sunflower oil at NPR 275, and mustard oil ranges from NPR 255 to NPR 360, depending on the brand. Despite this, private retailers have implemented much steeper price hikes.

Supply Chain Disruptions Drive Price Hike

Experts, including Bibhor Agrawal of the Nepal Rice, Oil, and Pulse Industry Association, cite a combination of rising dollar rates and logistical interruptions as key reasons behind the spike. “Major shipments from countries like Argentina and Indonesia are currently stalled mid-route, causing scarcity and higher transportation costs,” Agrawal explained. Unlike paddy and rice, which can be imported from neighboring India, Nepal relies heavily on third countries for edible oils.

Global crude oil prices for edible oils are also high, with palm oil trading at $950–1,000 per ton, soybean oil at $980–1,050, and sunflower oil at $900–950. Data from Nepal Rastra Bank indicates a 7.61 percent increase in ghee and oil prices during Magh, with the trend expected to continue in Falgun.

Government Intensifies Monitoring

In response to public complaints over uncontrolled price hikes and suspected black marketing, the Department of Commerce, Supply, and Consumer Protection has stepped up market inspections. Director Narhari Tiwari confirmed that detailed verification is underway to determine whether international supply disruptions are genuinely affecting domestic prices. “Market stocks are sufficient, and no one creating artificial scarcity or cartel-based price increases will be tolerated,” he stated.

Consumer rights groups have urged stricter government intervention, highlighting that some retailers are selling existing stock at inflated rates even before international prices rose.

Soybean Oil Import Status:

Sunflower Oil: Ukraine and Argentina are Main Sources

Nepal’s Oil Imports and Source Countries

Nepal imports edible oils from multiple countries. Major suppliers include Argentina, Indonesia, and Ukraine, which provide oils such as soybean, sunflower, palm, olive, and mustard oils. Customs data shows that NPR 93.75 billion worth of edible oils were imported in the first seven months of the current fiscal year, with NPR 78.19 billion worth exported.

• Soybean Oil: Dominated by Argentina, with smaller imports from China, Brazil, Thailand, and Ukraine.

• Sunflower Oil: Mainly from Ukraine and Argentina, with smaller volumes from India, China, Kuwait, Malaysia, Qatar, Spain, Turkey, and UAE.

• Palm Oil: Primarily from Indonesia and Malaysia, with minor imports from the Philippines and Thailand.

• Olive Oil: Imported from Bahrain, Cyprus, India, Italy, Kuwait, Oman, Qatar, Saudi Arabia, Spain, Turkey, Tunisia, and UAE.

• Mustard Oil: Mostly from India, with minor quantities from China.

Other imported oils include cod liver oil from the US, coconut oil from India and Malaysia, fish oil from Australia and Hong Kong, and various vegetable fats from countries like Israel, Singapore, and the UK.

The government has stressed that despite global disruptions, Nepal’s edible oil stock is sufficient, and authorities are committed to preventing artificial shortages and price manipulation.