5 months ago

Global rice prices hit 18-month high

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Global rice prices have spiked notably in recent months, raising further concern for Bangladesh which is in quest of 1.10 million tonnes of the staple from global sources, said insiders.

The FAO All Rice Price Index in its October report said the Index increased by 2.2 per cent to 110.9 points in September 2022, which is an 18-month high.

The Food and Agricultural Organisation (FAO) routinely publishes the index under the United Nations.

The major concern of Bangladesh is the rising price of Indica species, consumed by South and South-East nations, by 3.4 per cent (index rose to 111.6 points) above its August level, it said.

FAO data shows that parboiled 5.0-per cent broken rice from India, Pakistan and Vietnam prices hit $380-396 per tonne (excluding freight and other charges).

Thai parboiled rice, suitable for Bangladeshi consumers, reached $453 a tonne in September.

The FAO cited Indian restrictions on full broken rice and its imposition of higher export duty on non-boiled rice as major reasons behind rising prices of Indica species in Asia.

The exchange rate of US dollar and purchase parity also put an impact on rice market, according to the report.

Value-chain expert and economist Prof Golam Hafeez Kennedy said Bangladesh has largely dominated the Asian 'Indica' rice market for the last few years with an average 1.0-million tonnes of import.

The country even imported a record 4.0-million tonnes of rice a few years back.

According to Mr Kennedy, rice market has remained almost static compared to other commodities this year.

Indica price primarily started rising with Dhaka's declaration to import a big chunk as well as its ease of import duties last June.

He said the recent hike would definitely hit efforts to import the targeted 1.1-million tonnes by the private sector as only 0.14-million tonnes have been brought in the last three months.

Rice prices might go up further in the coming weeks amid low imports as well as a squeeze in Boro crop supply, Mr Kennedy feared.

He suggested that import duty be made zero from existing 15.3 per cent for the next three months to encourage importers.

He also urged the government to bring its targeted 0.33-million tonnes of rice immediately under the government-to-government deals with India and Vietnam.

However, rice price continues to stay in its previous high as coarse rice retailed at Tk 42-54, medium at Tk 48-65 and finer at Tk 56-96 a kg across the country on Monday depending on varieties.

According to the Trading Corporation of Bangladesh and Department of Agricultural Marketing statistics, current rice prices are above 10 per cent higher on average than a year ago.

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