Cold storage owners seek loan at 7pc interest

Cold storage owners have urged the government to allow a 7.0 per cent bank interest rate for cold storage operations from the current 15–17 per cent.

At a press conference held at the Bangladesh Cold Storage Association's (BCSA) office in Dhaka, they cautioned that failure to meet this demand could lead to the proposed hike in fare, which has been set at Tk 8.0 per kg.

Presiding over the conference, BCSA President Mostafa Azad Chowdhury Babu says cold storage operators are witnessing severe financial challenges. Currently, they are burdened with high interest rates of 15–17 per cent on bank loans, which he described as unsustainable.

Combined with rising electricity costs, labor expenses, and other overheads, the cost of storing potatoes has surged to Tk 9.62 per kg.

Despite these rising costs, cold storage owners have been operating at a loss, charging Tk 350 per 65-72 kg sack, far below the actual cost.

New government regulations restricting bag weights to 50 kg have further complicated their financial situation.

As a result, the association has decided to raise storage rents to Tk 8.0 per kg, up from Tk 7.0 per kg last year.

BCSA has urged Bangladesh Bank to classify cold storage operations under the agricultural sector, allowing access to loans at a reduced interest rate of maximum 7.0.

Babu warned that without this relief, many storage facilities would be forced to shut down.

""If the government imposes the previous rental rates on us, we will have no choice but to suspend operations," he says, urging the agriculture and commerce ministry take immediate action.

He says Bangladesh is expecting a record potato production of 12 million tonnes this year, marking a 40 per cent increase from previous years.

However, thanks to this bumper harvest, potato prices have plummeted, with retail rates at Tk 8.0- Tk 12 a kg in rural areas and Tk 15-25 a kg in urban markets. Farmers hardly could realise the production costs now.

The BCSA’s decision to raise storage rents from Tk 4.5-5.0 a kg to Tk 8.0 a kg has sparked concerns among farmers and traders.

While the official storage fee for a 50 kg bag has now been set at Tk 400, farmers and traders anticipate an 70-80 per cent rise in costs depending on the region.

But Babu assured that even with increased storage rents, off-season potato prices will not exceed Tk 40 a kg in 2025. “If prices rise beyond this, you could hold me accountable,” he says.

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