The private sector has significantly raised rice import in recent months, taking the advantage of poor government food stock and higher price in domestic market, sources said Wednesday.
Experts and business circle fear that the private sector would dominate the domestic rice market unless the government raises its food procurement drive both from internal and external sources.
The reserve of rice has dropped significantly in recent times as the total government stock was 9,42,000 tonnes including 700,000 tonnes till January 15 last. A year back, the reserve was 1.3 million tonnes.
Local think-tank Centre for Policy Dialogue (CPD) said recently that the lesser food stock especially rice in recent days compared to previous years is much lower which causes concern.
Executive Director of the CPD Professor Mustafizur Rahman said the government should go for import of rice from India or any other food supplying countries in a bid to boost stock as the international market is cool now.
Development analyst Dr Mirza Azizul Islam said the poor public stock of the food grain would create room for the private importers to manipulate the local market.
"I think the private importers have already taken the advantage and started to intervene in the retail price. The retail price in the local market has already showing upward trend," he said.
Muhammad Al Amin, Senior Research Associate of the CPD said, "If the public stock is not enhanced, the private sector would get chance to destabilise the market.
The government would lose its market intervention tools, if it does not boost its rice stock to more than 1.0 million tonnes from the current stock of nearly 700,000 tonnes. The local market could be manipulated by the private importers, he said.
According to government data, the rice stock in July-December period of the current financial year (FY) 2013-14 has dropped by nearly half compared to the past couple of years.
During July-December period of FY2014, the rice stock has fallen to 676,000 tonnes compared to 1.13 million tonnes in the same period last FY2013 and from 11.16 million tonnes in the same period of FY2012, official data showed.
Director General of Food, Ahmed Hossain Khan, said there would be no scope for the private sector to manipulate the market as government stock would rise more than 1.0 million tonnes, a comfortable level for the country.
"Our procurement target of 1.0 million tonnes of food grain would be achieved within this month as Aman procurement has got momentum in recent weeks," he told the FE.
"We are close to achieve 300,000 tonnes of rice procurement target. The entire 45,000 tonnes of wheat from abroad would reach soon as we have already opened the LC," he said.
Earlier on November 28 last, the Directorate General of Food issued a circular directing its regional offices to procure 200,000 tonnes of Aman.
Interestingly, the government, unlike the private sector traders, is not interested to exploit the prevailing favourable food price situation in the international market despite the fact that its own food reserve has gone down considerably over the last one year.
Between July and December of FY2014, the government imported only 350 tonnes of rice which was 2200 tonnes in the same period last FY2013 and 43770 tonnes in FY2012, the government data showed.
The rice prices in the domestic retail market have gone up by nearly Tk 2 to Tk 5 per kilogram over the last few weeks.
