Published in The Financial Express on Thursday, 19 March 2015.
Aman output strikes all-time high
Millers, farmers call for curbing imports
Yasir Wardad
Aman rice output hit an all-time high of 13.19 million tonnes in Aman rice season as farmer bounced back from last year’s savage flood, the government has said.
The rice yield in Aman season showed 1.3 per cent growth in the current financial year over a year earlier, Bangladesh Bureau of Statistics (BBS) said.
Sector insiders said higher production in the first two rice seasons—Aus and Aman-has ground for restricting rice import to safeguard the local rice industry.
Considering the financial year or the Bangla calendar year, Aus is the first rice cropping season in Bangladesh followed by Aman, contributing 38 per cent, and Boro, contributing 55 per cent, to overall output, according to the agriculture ministry.
BBS latest data revealed that the production of Aman was a record13.190 million tonnes at 5.53 million hectares of land in FY’15, which was 13.02 million tonnes in FY’14.
Deputy director (agriculture wing) of BBS Bidhan Boral said that cultivable land remained almost static at 5.53 million hectares but per hectare yield has increased notably this FY which helped rise the production.
He said Aus production increased minimally by 2,000 tonnes in the current financial year and the two cropping seasons jointly gifted 15.518 million tonnes so far, which was 15.346 million tonnes in FY’14-or 1.12 per cent growth.
The BBS data showed that the country got a record 33.465 million tonnes of rice in the last financial year against 33.1 million tonnes of demand estimated by the Director General of Food (DGoF).
The government has now a good stock of 1.097 million tonnes of cereal including 0.814 million tonnes of rice and 0.099 million tonnes of wheat.
The food stock size was 1.084 million tonnes in the corresponding period of the last fiscal, the food ministry data showed.
According to the Bangladesh Auto Major and Husking Mills Owners Association, the biggest platform of the country’s rice millers, more than 20,000 millers and 0.35 million of traders have above 3.5 million tonnes of rice stock for every two month.
Despite bumper production in almost all cropping seasons, rice import (through the private channel) witnessed a record in the current financial year, according to the ministry of food.
The food ministry data showed that importers brought a record 1.057 million tonnes of rice in July-March’15 period of the current financial year when overall import was 0.374 million tonnes in FY’14.
The uncontrolled imports coupled with the two and a half month-long political turmoil have dealt a severe blow to the local rice industry, said the traders.
Rice millers said more than 60 per cent of the mills across the country were forced to close their operation this year following uneven competition with the Indian rice and the political upheaval continuing since January this year.
Rice prices, which increased significantly in January-February period, went down to the level of pre-blockade period from March, according to Bangladesh Auto Major and Husking Mills Owners Association (BAMHMOA).
BAMHMOA secretary KM Layek Ali told the FE that in the absence of any import duty, imported rice has flooded the market.
He said the government fixed minimum Aman rice price at Tk32 per kg when importers are bringing it at below Tk23-26 per kg.
He said: “Our milling cost is above Tk29-29.5 per kg for swarna variety.”
“This uneven competition forced 60 per cent of millers in the rice growing hubs to stop their operation”, he said.
He said: “Import is logical if the domestic supply is lower and price is volatile, but the country has been getting bumper production for the last few years.”
He said: “The government should impose a minimum 20 per cent import duty on rice import to protect the local rice industry.”
Center for Policy Dialogue (CPD) additional research director Dr Khondaker Golam Moazzem said domestic supply, demand and market prices should be considered before importers to import.
He said the local producers and its market players should get the first priority for the country’s food security.
He also said that the government should also look into the matter why local output cost is not competitive compared with that of other exporting countries.
He said the devaluation of Indian rupee against the US Dollar is on the rise parallel to it strong BDT against the greenback is giving the Indian exporters room for sending rice to Bangladesh.
tonmoy.wardad@gmail.com