The recent hike in rice prices has almost touched the past record of the financial year 2007-8, the period marked by global recession, which was all time high in the country's history, officials said.
They said prices of coarse rice jumped to Tk 37-38 per kg in the market recently which was exactly the same in FY'08 despite the fact that the country has got record rice output so far in FY'14 and its global price is also stable.
Experts blame the government policy for the failure in maintaining fair price of rice.
Rice, the staple crop, is cultivated in three seasons in Bangladesh. These are Aus, Aman and Boro. The seasons contribute 7.0 per cent, 38 per cent and 55 per cent respectively to total rice output, according to the ministry of agriculture (MoA).
Rice production in the Aus and Aman seasons showed a record high, excluding boro output, which will be available by June. The overall rice production reached 15.349 million tonnes in FY'14, a 1.95 per cent increase compared to that of the corresponding period of FY'13 when output was 15.055 million tonnes, according to the Bangladesh Bureau of Statistics (BBS) data.
"But, despite having good production, the price of the staple is marking all time high depriving the consumers benefits of higher output," Consumers Association of Bangladesh Secretary Humayun Kabir Bhuiyan told the FE.
He said rice price is now 40-42 per cent higher compared to the prices of last year.
"Absence of government market intervention, lack of dynamic marketing policy and monopoly of the big millers are responsible for the higher prices," he said.
However, coarse rice Shawrna variety was selling at Tk 34-35 (Rangpur, Rajshahi) and Tk 37-38 per kg (Dhaka, Chittagong).
Finer variety Miniket was sold at Tk 48-55, Najirshail Tk 54-57, medium quality Brridhan-28 at Tk 43-46, Paijam Tk 46-48 per kg in the country, according to the Department of Agricultural Marketing (DAM).
An official at the DAM said the price has touched the previous record of FY'08 when coarse rice price hovered between Tk 37 and Tk 39 per kg excluding the rice sold under government's OMS programme.
This was a period of world recession when rice price (5 per cent broken parboiled) in the global market jumped to $1080 per tonne, an all time high.
"In Bangladesh, a sudden flash flood in Haor areas and elsewhere in the country destroyed nearly 2.0 million tonnes of paddy during the period, which was a key reason behind the price hike in Bangladesh," he said.
He said the price of rice (5 per cent broken parboiled) is stable in the global market and was hovering between $395 and $425 per tonne for the last one year.
Farm economist ASM Golam Hafiz Kennedy said crop loss in flood and refusal of the neighbouring country India to export rice to Bangladesh were the reasons behind the hike in FY'08.
"The recession and lower output forced many countries to stop export for their own food security," he said.
"But the condition is totally different now as global production has been showing a good trend for the last five years. Price is also stable," he said.
He also pointed out that the country is importing a large volume of rice for the last one year both through public and private channels.
"Market monitoring should be increased whether the millers are following the government instruction of 60 days stock facility," he said.
"Rice procurement for the government storage from domestic sources should be increased to at least 2.0 million tonnes to keep a good hold of the market," he added.
But, he also said that the rice prices of FY'14 are not higher compared to that of FY'08 if we take the inflation over the last six years into consideration.
When asked, Bangladesh Auto, Major, Husking Mill Owners' Association (BAMHMOA) convener KM Layek Ali said rice price maintained a high trend from Aman and Aus harvests.
"Farmers got prices between Tk 680 and Tk 750 for per maund (40 kg) of normal variety of paddy in Aman and Aus seasons. The prices of different varieties of paddy are now hovering between Tk 750 and Tk 900 per maund," said Ali, representing the country's 21000 rice mills.
"Higher prices of paddy and higher interest rates of bank loans are the two major reasons behind the recent price hike," he said.
But, he said that the price will come down in next couple of weeks with the beginning of Boro harvest.
According to the Directorate General of Food (DGoF), the country's rice demand stands at 31.0 million tonnes.
Overall rice production was 33.77 million tonnes in FY'13 and the target for the current financial year has been set at 34.5 million tonnes.
Rice prices mark record high despite good output
Yasir Wardad | Published: April 28, 2014 00:00:00 | Updated: April 27, 2014 22:42:19
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