The prices of vegetable oils, and palm oil in particular, have risen rapidly in the country. Average retail prices increased nationally by 122% over the past year (March 2022 vs. March 2021). As vegetable oils typically account for 5% of consumer food expenditure in Myanmar, this price increase is causing significant hardship, especially for the poorest households.
Vegetable oils are less available in retail markets, especially in conflict-affected areas, compared to the same period last year.
This lower availability and high prices lead to lower usage: 63% of food retailers report that fewer vegetable oils were purchased by consumers in March 2022 compared to the previous year.
Local price increases and lower availability are due to: 1) International price increases. Palm oil prices on international markets have risen rapidly over the past year due to supply problems in producing countries and over the past month in particular due to the crisis in Ukraine (a major supplier of sunflower oil). 2) Depreciation of the local currency. The official MMK/USD exchange rate depreciated by 25% between mid-March 2021 and mid-March 2022. Market rates showed even greater depreciation. 3) Policy change. The military government has implemented a system of import licenses and quotas, limiting palm oil imports into the country.