The food stock of Bangladesh has reached a new height of two million tons, with warehouses full of rice and wheat. Despite that, food prices are soaring.
Market analysts and Food Ministry officials are mystified as to the reason behind food prices soaring in the domestic markets.
According to the daily food grain situation report of the Ministry of Food, the total food grain stock in the country on February 9, 2022 was 2.002 million tons. Of this, the stock of rice was 1.69 million tons, wheat 277,000 tons and 49,000 tons was paddy.
Whereas the secure food stock level for the country is one million tons, the stock of food grains crossed two million tons.
Past data shows that there has never been such an official stockpile of rice earlier. At this time last year, the quantity of food grains stored in the government warehouses was 721,000 tons. Of this, the stock of rice was 537,000 tons, which was the lowest in a decade.
Citing "current stock is satisfactory", the report said that Aman paddy, rice and wheat procurement activities were being conducted from domestic sources and stocks of food grains were recorded due to the import of rice from abroad.
Despite good yields of Aman and record production of paddy in the last Boro season, several markets in the capital were visited recently which showed that the price of rice (old) is rising.
According to the trading corporation of Bangladesh (TCB) coarse rice was sold at Tk46 to Tk48 per kg in the capital's markets on Wednesday, February 17. It showed that prices have risen by 4.35% in one year. A fine variety of rice (Miniket-Nazirshail) has been sold at Tk60 to Tk67 per kg. In a year it has increased by 7.6%.
Dr. Mosammat Nazmanara Khanum, Secretary to the Ministry of Food, told UNB in this regard: "The ministry has already set up buffer stocks of food grains in government warehouses to deal with any situation during the Covid-19 pandemic period."
Currently, the country’s foodgrain stock is more than two million tons. This buffer will help keep the market situation normal in the country, she said.
"In addition to this, we have also strengthened OMS activities to keep the prices affordable at the market level. The purpose is to ensure that the low-income people of the country can buy rice or flour at a lower price,” said Dr Nazmanara.
People of almost all classes and professions are under pressure due to rising commodity prices in this pandemic period. Despite bumper paddy production in the Aman season, the price hike of food grains is a matter of surprise and it does not match with market analyzing theories.
Golam Rahman, president of the Consumers Association of Bangladesh (CAB), an organization working for consumers’ rights, opined that increasing the coverage of OMS for working and low-income people will help them to get rice at a fair price.
He also said that buffer food stock in the country will give relief to the consumers as markets would refrain from a drastic rise in the rice price.
"If the rice and wheat provided in the open market sales (OMS) will be intensified, the prices of other essential goods will be under control in the market and then the consumers will get the benefits," Golam Rahman said.
"In order to keep the market situation normal, government warehouses need to have at least one million tons of rice considered as security stock," he added.
It is better to have extra. With the current stock of food grains, it is possible to control the price of rice and flour/wheat in the country as well as deal with any crisis, CAB president said.
M Asaduzzaman, a former research director at the Bangladesh Institute of Development Studies (BIDS), and an agro-economist told UNB, "Food stocks have increased, it's good. But we need to find out why prices are rising.”
In this case, if someone has manipulated or increased the price by forming a syndicate, the government should take action against them, he said.
Bumper food grains production in the country and record two million tons stock of food would indicate there is no reason for the food grains price to go up in the domestic markets and the current price of rice is not acceptable, Asaduzzaman said.
"A large number of people in the country are at risk of food insecurity after losing their jobs due to the shock of the pandemic," he said.
Abdur Rashid, president of Bangladesh Auto Rice and Husking Mill Owners Association, an association of rice mill owners, said mill owners are not at all responsible for the rise in rice prices.
"We buy paddy and produce rice, millers (rice mill owners) are not involved in raising rice prices at all, and such allegation is baseless," he said.
