Edible oil, ghee sector: CCP begins probe into suspected cartelisation

ISLAMABAD: The Competition Commission of Pakistan (CCP) has launched a fresh investigation into suspected cartelisation in the edible oil and ghee sector after receiving a reference from the Economic Coordination Committee (ECC).

The move came amid concerns that a significant decline in global palm oil prices has not been reflected in the domestic market.

According to official data, international palm oil prices have fallen by 24 percent since December 2024. However, retail prices of cooking oil and ghee in Pakistan have increased by around 5 percent during the same period. Raw palm oil constitutes nearly 65 percent of the total cost of cooking oil, while the remaining 35 percent relates to shipping, processing, and packaging.

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In response to the price anomaly, the CCP has begun urgent data collection to examine pricing mechanisms and market conduct of edible oil importers and manufacturers. The inquiry will assess whether uniform or coordinated pricing practices are contributing to the lack of pass-through to consumers.

The latest probe follows earlier enforcement by the CCP, which imposed a PKR 50 million penalty on the Pakistan Vanaspati Ghee Manufacturers Association (PVMA) and its member companies for jointly announcing price increases. The Competition Appellate Tribunal upheld the CCP’s order, and the matter is currently pending before the Supreme Court.

A CCP official said the Commission would investigate all relevant market players and take action where anti-competitive conduct is established.

The move also coincides with government concerns over rising food prices. In a recent meeting of the National Price Monitoring Committee (NPMC), chaired by the Minister for Planning, the widening gap between wholesale and retail rates of essential commodities was highlighted, and the Finance Division was asked to support the CCP’s efforts.

The CCP has the authority to seek data, conduct inspections, and impose penalties on undertakings found involved in cartelisation, collusion, or unfair market practices.

The Commission is expected to issue initial findings in the coming weeks. If violations are confirmed, enforcement measures may be taken to ensure price correction and protect consumers.

Copyright Business Recorder, 2025