Impacts of flood on agriculture

On 19th August 2024, Bangladesh found herself grappling with an unprecedented flood that caused widespread devastation in the eastern regions of the country. If we take a closer look, we will see that the flood did more than just disrupting daily life. It had a direct impact on rice and other crop production.

Flooding has long been a cause for concern in the Sylhet region, and this recent flood expanded that concern to many other districts further south and along Bangladesh's coast, including Feni, Cumilla, Noakhali, and parts of the Chittagong Hill Tracts. This flooding was triggered by heavy monsoon rains and was likely worsened by the opening of the dam for the Dumbur Hydroelectric Project in the Indian state of Tripura.

Floods have always been an unfortunate but regular occurrence in Bangladesh, and the reason for Bangladesh's vulnerability to this natural disaster is well known: the very geography of the country. Being a low-lying, riverine region, it rests at the confluence of several large rivers-the Padma, the Brahmaputra, and the Meghna-that are prone to overflowing during the monsoon season, making Bangladesh consistently susceptible to seasonal flooding. This geographical vulnerability, combined with the dam opening, led to a devastating flash flood in August. However, this was not the only flood to hit the country in 2024. On 27 May, Cyclone Remal struck the coastal districts of Bangladesh. Hardly had Bangladesh recovered from the impact of the cyclone when heavy rain triggered floods in mid-June. Following these earlier disasters, flash floods from 19 August caused severe devastation, ultimately leading to a significant loss of crop production.

However, as mentioned before, floods and cyclones are not rare in Bangladesh. The major floods of 2019 and the cyclones of 2020 were particularly devastating, inundating large portions of both rural and urban areas, destroying homes, displacing millions, and severely affecting agricultural output, particularly rice production. Since rice is a staple food in the country, the loss of rice paddy production poses a serious to the country's food security.

Although Boro is almost 52per cent of the total rice production, it is unlikely for floods to disrupt Boro Cultivation since it is a dry-season paddy. However, the same cannot be said for Aman and Aus season.

Given the timeline for the cultivation of these three paddy varieties, the August flood is likely to disrupt the seeding and early growth stages of Aman cultivation. The final stage of Aus cultivation may also be disrupted.

Aman is widely cultivated paddy- mainly in Northern and Southern Bangladesh- Rangpur, Rajshahi as well as Barishal, Khulna. It is also cultivated in Mymensingh, Sylhet, and Chattogram as well. If we compare the region of Aman cultivation with the route of August flashflood, Aman paddy production in districts like Cumilla, Chattogram, Khulna, Bhola is likely to be harmed.

Preliminary reports and news sources indicate that, during the August 2024 flood, approximately 0.7million tonnes of Aman paddy production were damaged by the floods. This accounts for more than 4 per cent of the total Aman production for FY 2024, and this figure doesn't even include the recent damage caused by the flood in Mymensingh. Since the August floods struck during the final stages of Aus harvesting, they also damaged 1.06 lakh (0.106 million) tonnes of Aus production, which is around 4.15per cent of total Aus production of FY 2024. Since Aus held only 7.3per cent of the total rice paddy production in FY 2024, it is unlikely that Aus production damage will hurt food security to a greater extent. However, Aman, which accounts for about 41per cent of Bangladesh's total paddy production, may have a significant impact with the 0.7 million tonnes of damage. According to the Ministry of Agriculture reports, the August floods in the eastern and southeastern region and the very recent flood in Mymensingh led to a production loss of almost 1.1 million tonnes of rice, especially Aman. It is more than 5per cent of the total rice paddy production in FY2024. As of August, it was estimated that more than 0.7 million acres of Aus and Aman paddy lands have been fully or partially damaged, whereas a total of 16.8 million acres of land was used in FY 2024 for the Aus and Aman production.

By comparing the damage from previous years, the severity of this year's flood becomes clear. The July 2020 floods resulted in a production loss of around 32,000 tonnes of Aman paddy, while approximately 69,000 acres of Aus and Aman paddy land were completely damaged (Source: BBS). The Bulbul Cyclone in November 2019 caused damage to around 80,000 tonnes of Aman paddy production. The damage of 0.7million tonnes of Aman paddy production in the August 2024 flood, compared to the total production of around 16.7 million tonnes, may not seem significant. However, when compared to the Aman paddy production losses of recent years, the scale is unprecedented. A report suggests that total rice production could drop by 0.85 million tonnes due to the floods, posing a substantial threat to the nation's food security.

In the aftermath, during the first week of October, the Centre for Policy Dialogue (CPD) reported that the agriculture and forestry sector suffered the highest damage due to the recent floods, amounting to BDT 51.70 crore. However, since the timing of the flood coincided with the Aman seeding season, the CPD urged that an adequate supply of seeds must be ensured to prevent next season's Aman cultivation from being hampered.

Now the concern remains about food inflation. This blow to the production of rice, a staple food of Bangladesh, is already making its presence felt in the market. The price of rice has already increased by BDT 5 to BDT 8 per kg at the retail level, with many vegetables' prices also seen skyrocketing. Medium-quality fine rice can be seen selling at a minimum of BDT 70 a kg currently, whereas it was sold at around BDT 65 two-three months before. The same goes for best-quality fine rice, which was sold priced at BDT 75 during previous year around this time but is currently priced at BDT 80 or more. While it can be expected that food inflation is likely to take a hit during the ongoing month of October, there is still hope. If there are no more floods and enough Aman paddy seed is supplied and sowed, it can be expected that rain will assist in Aman production. Additionally, vegetable prices are expected to stabilise when the early harvest of winter vegetables becomes available in the market.

The good news is that the government has cut import duty on rice by 37per cent. The existing customs duty on rice has been lowered to 15per cent from 25per cent and the existing regulatory duty has been lowered to 5per cent from 25per cent. The existing 5per cent advance tax has also been completely withdrawn.

The government has initiated the import of 0.5 million tonnes of rice and is expected to permit private imports soon to ensure food security and stabilise prices. This timely decision is anticipated to protect the country from a continuous surge in food inflation while safeguarding food supplies. With careful management and timely support, there is hope that the impact of the floods on food security can be minimised in the coming months, keeping in mind that the August floods are not a one-time event. The government and relevant authorities must always be prepared with flexible and proactive measures to safeguard our riverine country.

...........................................................................................

The writer is an Investment Analyst, UCB Asset Management

[email protected]