Ban on aromatic rice export set to go

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Nazmul Ahsan
The government is set to lift the ban on export of rice with immediate effect, sources in the ministry of commerce said.
The ban has been in force over the last one year.
The ministry has already got the go-ahead signal from the ministry of food for lifting the ban on export of rice, the sources added.
The clearance for export of rice will be given in the first phase for a quantity of 10,000 tonnes. Further clearance will be considered in the next phases, later. Only fine variety of rice will be allowed for export, the officials of the ministry of commerce said.
"We are going to withdraw the ban immediately on export of aromatic rice, after a thorough study of the pros and cons of such a decision," a high official in the commerce ministry said.
"The businesses will be benefited by the decision about allowing export of rice. The local consumers will have no reason to be worried over the supply situation following the bumper harvesting of boro paddy," the official sources added.
The ministry has finalised rice export guidelines on Thursday to accommodate the demand of genuine exporters, sources said.
The withdrawal would help mitigate the loss and address the plight of rice exporters, caused mainly by earlier government directives relating to enforcing the ban, exporters said.
According to the guidelines, the export has to be completed within the next four months, following the date of issue of the export clearance by the ministry of commerce.
The export clearance will be issued for a maximum of 200 tonnes of rice by an individual exporter. The exporters who had already opened letters of credit to export rice but failed to make the shipment due to the ban, will be given priority while giving the clearance for export, the guidelines added.
The genuine exporters having good track record will only be considered for the short-term business, the guidelines elaborated.
The six-month ban order on export of rice, excepting the fine variety ones, was first enforced on May 6, 2008 amid severe short supply of foodgrain in the country. The ministry of commerce, upon expiry of the period, extended the ban for all categories of rice for another six months in November, 2008, amid allegations by some quarters about export of coarse rice in the name of fine or aromatic rice.
For the second time, export ban expired on November 6, 2008. The ministry of commerce then again extended the ban on export of all categories of rice on November 19, 2009 for another price of six months.
This ban was furthermore extended on May, 2009 for a similar stint.
A good number of rice exporters got export orders and many of them opened letters of credits (L/Cs) between November 7, 2008 and November 19, 2008 but their business was then badly affected because of the re-extension of the period relating to ban on exporting rice, exporters said.
The ban, however, could not be properly enforced by November 6 as the ministry of law had taken more time in vetting the order, a high official of the ministry of commerce said.
'The already affected rice exporters would be greatly benefited after lifting the ban,' he told the FE.
Meanwhile, above 300 exporters have so far applied for permission to export rice to the ministry of commerce, sources said. They sought clearance for export of rice for quantities ranging between 30 tonnes and 3000 tonnes.
The exporters sought to export for a total quantity, ranging between 50,000 tonnes and 60,000 tonnes of rice, an official concerned said.
He, however, could not give any clue as to what had caused a sudden surge of exports by local rice exporters.
Sources in the business circles said, they are willing to export local varieties of rice to the Middle Eastern countries, Italy, the USA, UK, Greece, Singapore, Canada and France. The Bangladeshis living in those countries are the major buyers of such rice.
"The demand has risen in recent times as the expatriate Bangladeshis cannot buy Bangladeshi rice for the last one year," an official of Mrs Flora -Ex, which sought permission for exporting 1000 metric tonnes of rice to Canada.
'We can make above Tk 50 profit out of export of 1.0 KG of rice,' Saifur Rahman of Universal Trade International, told the FE.
"The government should allow us to export rice as both exporters and the country will be benefited in the process."
Bangladesh exported rice worth about $ 9.0 million in fiscal year (FY) 2007-2008 and $ 5.97 million in FY 2006-2007.
On the other hand, the country imported 0.53 million (5.3 lakh) tonnes of rice during the first nine months of the just-concluded fiscal, 1.634 million (16.34 lakh) tonnes in FY 2007-2008 and 0.367 million (3.67 lakh) tonnes in FY 2006-2007.
However, some quarters suggested that the government should not allow export of rice for an unlimited period and the possibilities of some surge in the price of rice in the domestic market should not altogether be ruled out.
Sources in the ministry of food said export of 10,000 tonnes would not harm the local market, considering the demand situation after a good Boro harvest, totalling about 20 million (2.0 crore) tonnes.
The next phase of rice export from the country should be related with the next aman production, they further suggested.