Rice price high despite new harvest, abundant imports

Different varieties of rice grown by farmers in the surrounding villages are sold for between 1,400 and 2,000 Tk per maund (around 37 kilograms) at a centuries-old floating market sitting every Saturday and Tuesday on the Sandha River in the upazila Banaripara of Barishal. The photo was taken yesterday. Photo: Titu Das

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Different varieties of rice grown by farmers in the surrounding villages are sold for between 1,400 and 2,000 Tk per maund (around 37 kilograms) at a centuries-old floating market sitting every Saturday and Tuesday on the Sandha River in the upazila Banaripara of Barishal. The photo was taken yesterday. Photo: Titu Das

Rice prices have remained high in Bangladesh despite a plentiful supply of grains as farmers harvest Aman’s second largest crop, putting low-income groups in a difficult position amid continued economic uncertainty.

Over the past month, retail rice prices have risen 6% in the capital’s markets.

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The prices of medium-quality cereals registered the largest increase, followed by finer and coarse rice, straining the purchasing capacity of low-income people, who already count more for rising transport costs and soaring prices for various basic necessities, including edible oil. .

Average grain retail prices yesterday were Tk 52 to 58 per kilogram, up from Tk 48 to 56 a month ago, according to data from the state-run Trading Corporation of Bangladesh.

The finer variety was selling 3 percent more at Tk 60-Tk 70 yesterday compared to a month ago. Coarse grain prices increased 3 percent to Tk 45-50 in the past month.

Millers and traders claim that purchases made by rice mills, including large industrial companies such as ACI Ltd, City Group, Pran and Akij Resources, which have entered the rice market in recent years, to build up stocks in order Marketing the staple food during the lean season is one of the drivers of higher paddy prices.

Higher transportation costs, fueled by the government’s rise in diesel prices in November, contributed to the rise in the price of grains, which are also subject to tariffs and taxes of 62.5 percent when ‘they are imported.

Data from the Agricultural Marketing Department (DAM) showed that the prices of coarse and medium grains of paddy, which are cheaper than finer ones, have increased over the past month.

For example, prices for Coarse Aman, the second largest paddy accounting for 38 percent of annual rice production, fell from Tk 919 to Tk 950 a month ago to Tk 913 972 on the maund on January 3. Such a peak during the harvest season has raised questions.

In Bangladesh, imports increased thanks to reduced import tariffs from December 2020 to October 2021.

Out of the total imports of 13.59 lakh tonnes in fiscal year 2020-21 which ended in June, private importers contributed 7.86 lakh tonnes.

They have purchased 2.82 tonnes of lakh from the international market so far in the current fiscal year, and the imported rice is already available in wholesale markets in Dhaka.

“There may be a justification for the increase in prices during the lean season. But any increase in prices is illogical during the high seasons,” said Al Amin, a private worker who lives in Uttara de Dhaka.

Nirod Boron Saha, a rice and paddy wholesaler in Naogaon, one of the main rice wholesale centers, said rice prices have remained high even during the harvest season due to purchases by millers. .

Managers from three rice mills agreed with Saha, adding that millers and large wholesalers are busy procuring paddy for storage as they seek to sell rice during the lean season before the next late harvest arrives. April.

In addition, some farmers are storing paddy in hopes of selling it later at higher prices, creating crises in the market, according to market insiders.

The Agricultural Extension Department (DAE) estimates the transplanting of Aman crops to 56.2 lakh hectares of land in the current fiscal year, up 4.3% from the previous year.

“We expect a good harvest this year,” said a DAE official.

Abdur Rashid, president of the Bangladesh Auto Major and Husking Mill Owners Association, said the increase in income tax, production and transportation costs had affected millers and pushed up production costs.

Following the rise in rice prices, Food Minister Sadhan Chandra Majumder, in a meeting with millers and warehouses on December 27, called on them to help keep the market stable.

He also alleged that the mill owners and warehouse keepers manipulated the prices of rice.

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