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19 June, 2017 00:00 00 AM / LAST MODIFIED: 19 June, 2017 12:21:27 AM
Govt godowns run low on stocks

Shortage of rice spurs price hike

Food minister urges NBR to scrap tariff on rice imports
Shortage of rice spurs price hike

Prices in the rice market have become volatile following shortages in production and foodgrain stocks in the country. The food minister himself has admitted to the unstable situation in the rice markets and insufficient stocks of the staple foodgrain in the government’s godowns.
Coarse rice is now selling at Tk. 48 per kg in the open markets. It was sold at just Tk. 25 per kg this season last year. Multiple sources in the food ministry expressed fears that there will be a shortfall of at least 35 lakh tonnes of rice in the current season. “There is a vast gap between food collection and present market prices. We have collected only 32,000 tonnes of rice against the targeted eight lakh tonnes because of the difference in prices. We would be able to collect at least four lakh tonnes of rice at this moment if prices were stable in the market,” food minister Qamrul Islam told The Independent yesterday. The rice market will not be stable until tariffs on rice import are removed, the minister said, adding, “The ministry had written to the National Board of Revenue (NBR) two months ago for removal of the 28 per cent tariff on rice imports. But the NBR is yet to take any action in this respect.”The importer has to pay an additional Tk. 9 per kg of rice because of the tariff, and the rice market will not be stable until and unless the tariff is removed, the food minister added.  The minister claimed that some 4.5 lakh tonnes of rice were in the pipeline. These are being imported from abroad.
“It’s true there are insufficient food stocks in the godowns. However, the gap will be filled within a month as 4.5 lakh tonnes of foodgrains are in the pipeline. There is no food crisis in the country at this juncture,” the food minister said in reply to a query.
According to sources in the food department, at least eight lakh tonnes of rice are required for stocks in godowns to ensure food security, but the government godowns had only 1.89 lakh tonnes of rice till Sunday. Besides, there are also about three lakh tonnes of wheat in different godowns.  There were 5.36 lakh tonnes of food stocks in different godowns on June 18 last year, the source added.
Around 15 lakh tonnes of coarse rice were imported in the 2014–15 fiscal year (FY) through the private sector, 2.57 lakh tonnes in the 2015–16 FY, and 1.21 lakh tonnes in the current FY, sources in the food ministry said.
“We have already opened a letter of credit (L/C) to import 2.5 lakh tonnes of rice from Vietnam under a government-to-government (G2G) basis. We hope the rice would reach
Bangladesh within 15 days,” Badrul Hasan, director-general of the food department, told this correspondent.  Besides, the food department has also signed contracts with two bidders for one lakh tonnes of rice commercially, he added.
The government is also corresponding with India and Thailand to import rice, he added. “The Thai authorities have invited us to visit their country. Our team will visit Thailand after Eid to discuss procuremeDnt of rice for Bangladesh,” Hasan said in reply to a query.
The sources in the ministry said the shortfall of rice was caused by the damage to paddy in haor and other areas as a result of flash floods and blast diseases. Also, the quantity of dried rice (chita) has been much higher this year in comparison with last year.
The agricultural ministry had set a target of 1.91 crore tonnes of ‘boro’ production this year. However, it estimated that 11 lakh tonnes of paddy would fall short of the target.
In such a situation, the officials of the ministry and the directorate-general of food are waiting for the decision of the NBR to withdraw the 28 per cent tariff on rice imports from abroad, the ministry sources said, adding, “Although the NBR is positive about withdrawing the tariff, some of the officials in the Prime Minister’s Office (PMO) are not agreeable to withdrawing it.”
Private importers can import rice from any country within a week if they want. In such a situation, if the government withdraws the tariff once, private importers would shortly start importing rice. This might result in a decline in rice prices in the market by Tk. 5 to Tk. 8 per kg within a week, they claimed.
Although the directorate-general of food started its internal rice procurement from local production on May 2 this year, it could buy only 28,917 tonnes of rice from the local market at Tk. 34 per kg. At present, rice is being sold at a minimum of Tk. 46 to Tk. 48 per kg.
It could not buy a single tonne of paddy from the farmers at Tk. 24 per kg as paddy is being sold at Tk. 27 to Tk. 30 in the local market.
Though the department of agricultural extension (DAE) estimated losses of around 11 lakh tonnes of rice in the floods, the officials of the food ministry and directorate-general of food apprehended that the losses may not be less than 35 lakh tonnes. In such a situation, the government will require more than 20 lakh tonnes of rice imports from abroad.
According to the directorate-general of food, they have chalked out plans to import around 10 lakh tonnes of rice under governmental arrangements. Of these, six lakh tonnes of rice would be imported with the allocation of the current fiscal year. The rest would be bought from next year’s budgetary allocation.
Replying to a query, Badrul Hasan also disclosed that his department has not yet responded to a letter from the disaster management and relief ministry to allocate around one lakh tonnes of rice towards special Vulnerable Group Feeding (VGF) ahead of Eid because of the shortage.




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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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