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Dhaka Tribune

Government food reserve declines

Update : 23 Nov 2013, 08:11 PM

The government’s strategic food reserves and imports have declined drastically due to political uncertainty ahead of the general election, official sources said.

“The country’s total reserve food stock, that has been depleting for past several months, has come down to 1.1m metric tonnes which is low for our food security,” a senior official of the food ministry said.

The official also said as the end of the present government’s tenure was closing in, food grain importers appeared to be uninterested in importing items due to political turbulence and hartal.

The official food stock is used to supply grains to the public distribution system, fair price, OMS, the school feeding scheme and other welfare schemes run by the government. It is also used under the market intervention scheme to stabilise prices in the open market. The food reserve gives the government the leverage required to control food prices.

Total food stock reserves dropped to 1.06m tonnes as of November 19, from a peak of 1.46m tonnes in November last year.

The break-down of the food grains stacked in government storehouses revealed that the stock of rice was 0.37m tonnes lower than the minimum quantity required under the buffer stock norms and rest of the food grain was wheat.

In the fiscal year 2011-12, some 1.88m metric tonnes of wheat and rice were imported by the private and public sector, while in the first five months of this fiscal year, 11.35m tonnes have been imported, according to data from the food division.

According to food ministry data, per kg coarse rice was selling at Tk34-35 while one year ago it was Tk31 per kg.

“The government is still in a comfortable position even after a marginal decline of the reserve. The price of rice is now declining because of the bumper Aman harvest,” Ahmed Hossain Khan, the director general of the Directorate of Food, told the Dhaka Tribune on Friday over phone.

He also said the price of rice would decline further after the full Aman harvest. The food reserve will increase within a short time as most of businessmen are importing wheat from aboard although it is not possible to import of rice as the price of rice has raised on the international market recently, Ahmed added.

When asked about the import of food being hampered by political unrest, the director general declined to comment on the matter.

“We will declare our Aman procurement within three days,” he said.

The food ministry has already sent a proposal of import of 50,000 tonnes of rice to the cabinet committee thought a private firm M/S Amira Pure Foods Pvt Ltd with a cost of Tk1.24bn.

Proprietor of Pubail Salt Industries Paritosh Kanti Saha told the Dhaka Tribune the political uncertainty and fear of destruction in hartal had gripped the import and export sector. As a result import had declined.

“Transportation cost, especially the rent of trucks, has increased by 100% from Tk15,000 to Tk30,000 due to hartal and unrest,” he pointed out.

As a result it will definitely impact price and food stock negatively, he said.

The country had a food stock of 1.26m metric tonnes when Awami League assumed power in 2009. Bangladesh’s average annual demand for food grains—basically wheat and rice—is 29m metric tonnes and the target of food production in the current fiscal year is 36.6m tonnes, according to the food directorate.

Usually, the government sets aside 1.5m tonnes of food grains to tackle any emergency situation.

Dr Mahbub Hossain, the executive director of Brac and an agricultural economist, said whatever the situation the government must maintain minimum amount of strategic food to face future crises.

Hossain said the price of rice on the global market had increased further because of drought and flood.

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