Rice procurement hits all-time high

But little benefit for farmers, consumers

Yasir Wardad | Published: March 16, 2019 10:16:27 | Updated: March 16, 2019 16:45:23

The government's aggregate procurement of rice from domestic sources has hit an all-time high of 2.2 million (22 lakh) tonnes in this fiscal year (FY), 2018-19, but fails to yield noticeable benefits for farmers and consumers, say insiders.

Rather, big millers and their politically powerful allies have benefited most from such a record procurement, they further say.

The Directorate General of Food (DGoF) purchased nearly 1.4 million tonnes of rice at Tk 37 (non-parboiled) and at Tk 38 (parboiled) per kg in the Boro season, 1.22 million tonnes of which were parboiled rice, said a DGoF official.

The procurement in the Aman season ended on March 07 and the collection stood at nearly 0.8 million tonnes, he said.

The government attached top priority to the domestic procurement after the rice market saw volatility in FY '18, he said.

The procurement exceeded the target of this fiscal as the government offered good prices, he added.

According to the Department of Agricultural Marketing (DAM), coarse rice prices were hovering between Tk 25-Tk 27 a kg at mill gates for the last three months (Aman season) while the government purchased rice at Tk 34 a kg from millers.

The DGoF official said their preliminary target was to procure 1.0 million tonnes of rice in Boro season and 0.6 million tonnes in Aman season.

But they collected 40 per cent and 34 per cent more rice than the target in the two seasons respectively, he said.

According to the food directorate, domestic procurement was 1.471 million tonnes in FY '15, 1.033 million in FY '16, 1.283 million in FY '17 and 1.05 million tonnes in FY '18.

Dr Md Asaduzzaman, professorial fellow at the Bangladesh Institute of Development Study, said though the government raised the quantity of rice for domestic procurement, farmers and commoners got little benefit from it.

The government had a target to procure food grains directly from the farmers, he said.

"But it is yet to develop necessary infrastructure regarding the issue which ultimately benefited only a section of traders and millers," he added.

He also said the government had not yet declared the Minimum Support Price (MSP), which remained a common agenda for every political party in the country.

Of 2.2 million tonnes of procured food grains, only 26,000 tonnes were bought in 'paddy' form, but farmers' contribution was too little in the regard, he said.

Bangladesh Agricultural Farm Labour Federation secretary Abdul Mazid claimed that millers, traders and local political affiliates made profits amounting to Tk 13.0 billion from the government rice procurement this fiscal year.

He said farmers incurred heavy losses in the Aman season as paddy was still selling at Tk 650-Tk 700 a maund against the production cost of Tk 800-Tk 850.

Bangladesh Agricultural Economists Association vice president Golam Hafiz Kennedy said city dwellers were still purchasing rice at a higher price.

Coarse rice Swarna was lately now selling at Tk 38-42 a kg in Dhaka and other big cities while medium and finer quality rice at Tk 55-Tk 70 a kg, he said.

Md Arifur Rahman Apu, director general of DGoF, told the FE that the country had now a rice stock of 1.45 million tonnes.

The government distributed 1.2 million tonnes of rice in the last one year under the safety net programmes, he said.

The rice prices declined both in rural and urban areas, thanks to better production and the government's market intervention, he added.

He also said the import of rice also declined following bumper local output.

The import fell to only 0.142 million tonnes in the first eight months of this fiscal year from 3.15 million tonnes in the corresponding period of last FY, the food ministry data showed.

The global rice prices remain almost static for the last one month-from US $340 to $ 380 a tonne.

The import cost of rice is now Tk 33.5 to Tk 37 a kg, according to food ministry.

The country produced a record 36.2 million tonnes of rice in the last fiscal year, the data of Bangladesh Bureau of Statistics (BBS) show.


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