Pakistan Spends a Record $3.8 Billion on Palm Oil Imports in FY26

Pakistan's palm oil imports surged to an all-time high of 3.482 million tonnes in the fiscal year 2026, costing the national exchequer $3.785 billion, as rising population and dwindling local oilseed crops drove demand for ghee and cooking oil to unprecedented levels.

Data released by the Pakistan Bureau of Statistics (PBS) showed that import volumes climbed from 3.214 million tonnes in FY25, when the bill stood at $3.4 billion. The average price per tonne of imported palm oil also edged up to $1,078 in FY26, compared with $1,056 a year earlier.

Sheikh Umer Rehan, chairman of the Pakistan Vanaspati Manufacturers Association (PVMA), attributed the record imports to growing consumption driven by population growth and lower domestic output of crops such as cottonseed. He said the country's edible oil consumption had swelled to 4.8 million tonnes, up from four million tonnes just five years ago.

Yet despite the sector's steady expansion, Rehan lamented that no edible oil policy had been formulated since independence.

The industry, he said, was now grappling with a fresh complication: the Federal Board of Revenue (FBR) has begun pressuring manufacturers to pay general sales tax (GST) on the retail price, whereas the levy had previously been charged at the ex-mill stage.

"Instead of creating a business-friendly environment and reducing the cost of doing business, the FBR is creating complications for taxpayers," Rehan said.

The PVMA chief warned that a new sales tax mechanism introduced in the FY27 budget will push up the retail price of ghee and cooking oil by Rs. 10 to Rs. 15 per kilogram.

The budget expanded the scope of the Third Schedule, shifting sales tax collection on ghee and cooking oil to a system based on the Maximum Retail Price (MRP), a move the industry argues will significantly inflate its tax burden.

The PVMA had previously urged the government to cut taxes on the edible oil and ghee sector in the budget to ease the strain on consumers.

According to the Sensitive Price Index (SPI), the national average price of a five-litre container of cooking oil now ranges between Rs. 2,975 and Rs. 3,110, compared with Rs. 2,800 to Rs. 3,000 a year ago.

A 2.5-kilogram tin of ghee sells for Rs. 1,500 to Rs. 1,565, up from Rs. 1,425 to Rs. 1,485, while a one-kilogram pack fetches Rs. 590 to Rs. 610, against Rs. 550 to Rs. 580 previously, reflecting a modest but steady climb in kitchen staples over the past twelve months.

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