Subsidised credit recommended to stabilise egg, poultry price volatility

Targeted subsidised credit and stronger market oversight are essential to stabilise poultry and egg prices, according to a Bangladesh Bank study on the agricultural sector.

The study points out that without financial support for smaller producers and closer monitoring of feed markets, price volatility will persist, hurting both farmers and consumers.

The findings, unveiled on Wednesday at the central bank's headquarters in the city, highlight structural weaknesses in the poultry value chain that leave small and mid-sized producers vulnerable to sudden cost shocks, supply disruptions and abrupt exits from the market.

The study, titled Value Chain Efficiency of Agricultural Products in Bangladesh, was jointly conducted by the Chief Economist's Unit and the Governor's Office between June 15 and July 7, 2025.

"The provision of concessional loans to farms with capacities of 20,000 to 50,000 chickens would help build a critical mass of independent producers capable of competing with large corporate operators," the report said.

At the same time, small-scale farmers raising between 1,000 and 3,000 chickens should receive targeted subsidised loans to lower production costs and shield them from market fluctuations.

"Without such support, many small farmers struggle to survive periods of high feed and medicine prices, leading to sudden exits from the market and sharper price spikes," the report noted.

The study also said access to foreign currency has emerged as a key constraint for the sector.

Beyond financing, it placed significant responsibility on the government to strengthen oversight of the poultry market. Feed price monitoring and regulation were recommended to curb excessive volatility, which is often passed directly on to farmers.

Customs procedures were identified as another pressure point affecting costs and supply chains.

For onions, the study advocated the introduction of a refinancing window offering loans at 4.0 per cent for small farmers. For potatoes, it recommended that the government immediately initiate procurement for open market sales (OMS) to stabilise prices.

One proposal calls for formally declaring the non-corporate poultry sector as part of the agricultural sector, which would allow small and medium producers to access concessions on electricity tariffs, taxes and bank loans.

The recommendations also highlight the need for a clearer Minimum Support Price (MSP) framework for poultry products.

The survey team visited 61 upazilas across 18 districts to assess five agricultural products - paddy, potatoes, onions, broiler chicken and eggs.

The objective of the study was to analyse value addition and price-setting mechanisms for selected agricultural products at every stage of the value chain.

Bangladesh Bank Director (Research) Dr Md Salim Uddin presented the findings.

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