After a bad crop year Bangladesh appears to be bouncing back with prospects of a good rice output this year.
The country's dependency on rice import is expected to drastically reduce by a fourth from a record import of the staple – 3.6 million metric tons (MT) in 2017-18 marketing year (MY) to just eight lakh MT in 2018-19 MY.
According to a just-released grain report by the United States Department of Agriculture (USDA), Bangladesh's total rice production is forecast to increase to 34.7 million MT in 2018-19 MY (in May-April) from the 32.6 million MT produced in 2017-18 MY.
USDA largely attributed a higher Boro production for this year-on-year output surge. Last year rice production fell due to a devastating haor flashflood and rice blast attacks.
In 2018-19 MY, which begins with the harvesting of Boro, the production of rice is forecast to exceed the government's target, stated the USDA report, as farmers increased cultivation areas with an expectation of good prices, and to recoup the Boro and Aman production losses from the previous year.
"Farmers have switched to Boro rice from wheat and potato cultivation as they attempt to avoid loss from wheat blast and the lower price of potato. The government’s procurement price of Boro and Aman paddy [unhusked] and rice [milled] of last year offers an opportunity to get good prices for this season's Boro rice," said USDA.
However, USDA noted, farmers' expectation of a higher price may be dampened if production is higher as expected and imports continue to follow the pace of the last few months. "As highly fluctuating husked rice price is mostly controlled by millers, past experience indicates that millers manage to keep the paddy purchase price lower through imports of more rice [husked] before the harvest season."
USDA estimated that rice imports will fall to 0.8 million MT in 2018-19 MY, comparing it to an estimated 3.6 million MT in 2017-18 MY, due to higher domestic production backed by favourable weather conditions.
The rice import estimate is revised upward to 3.6 million MT in 2017-18 MY due to increased imports to fill the supply shortfall caused by the previous year's devastating flood and the application of a 2% import tariff.
According to the Ministry of Food, from July, 2017 to March, 2018, total rice imports were a little over 3.5 million MT. Of these, over 0.95 million MT has been imported by the government while the rest by private traders. This is the highest ever rice import in Bangladesh while the previous highest record stood at 3 million MT during the 1998-99 financial year.
Around 67% of Bangladesh's cultivated land area is used for rice production. A study by the Bangladesh Rice Research Institute (BRRI) reported that in the period 1990-91 to 2016-17, adoption of modern varieties (MV) increased area by 11% in Boro, 246% in Aus and 135% in Aman season rice.
Although government has a long term plan to reduce Boro rice area and increase Aus and Aman rice production, the yield of Boro rice is still dominant in producing 54% higher yield than Aus and 40% higher than Aman.