Agri Biz
BD opts to explore alt-sources for wheat import
Bangladesh has opted to explore alternative overseas sources to meet demands for wheat, even with higher cost, as the war between Russia and Ukraine blocked ways for import of the country’s second major staple from these two wheat-producing nations.
“Presently we are getting no wheat from Russia and Ukraine, a situation which prompted us to allow private sector to explore new sources even if it cost a bit high,” said a food ministry official, entrusted with the task of overseeing food imports.
Mahbubur Rahman added that so far the private importers signed deals for importing 6.5 lakh tons of wheat, Bangladesh’s second major staple, from Bulgaria, Romania and even from Russia and under their agreements “Bangladesh by now received 3.13 lakh tons”.
“We expect the rest of the volume to come by end of December this year,” he said.
Bangladesh’s domestic average annual wheat production is around 10 lakh (1 million) tons against the demand for 75 lakh tons and 62pc of the imported wheat come from Russia, Ukraine and India.
Food ministry officials said, India too stopped exporting wheat in view of the global crisis to ensure their domestic food security.
After the outbreak of the war, Russia had stopped its wheat exports across the world but temporarily eased the restriction in principle under which Bangladesh received a consignment of one lakh ton in May this year.
Bangladesh last received 46,655 tons of Ukrainian wheat in May this year.
“From then on no wheat was available from either of the countries,” an official familiar with the situation said.
The officials comments came as the wheat price was increasing steadily in the past several months affecting the prices of bakery items including flour.
Food officials said Russian and Ukrainian wheat were used to be exported in much cheaper prices while India was providing it in lowest price but the situation forced Bangladesh to look for the staple in other countries including Canada.
The average per tonne wheat price in the international market on November 9 was US$353.67 which was $258.68 around the year in 2021.
Wheat importers said enhanced wheat prices in the international market exposed them to a challenge while the devaluation of Bangladesh currency has aggravated the crisis.
Food Minister Sadhan Chandra Majumder, meanwhile, said the government by now took all necessary steps to boost up the domestic food supply through raising import and food procurement to prevent any pandemic-like situation amid the current global crisis.
“Bangladesh is ready to overcome the food scarcity beefing up food supply through import and local procurement while the world economy is facing a catastrophe due to prolonged Russia-Ukraine war,” he told.
HE added, “But as part of food security precautions, we have laid emphasis as well on rice procurement (alongside wheat) from abroad and intensify vigil against hoarding with profiteering motive.”
The minister said several vigilance teams were formed with the ministry officials to enforce the vigil in different food markets across the country so none could create an artificial food crisis.
He said to beef up the food stock the government approved 10 lakh tons of rice imports while over 5.50 lakh tons already arrived and the rest 4.50 lakh tons will reach by the yearend.
Food officials said since the start of the Russia-Ukraine war, imports fell to rock bottom while the country’s overall food grain stock in the public sector now stood at over 15.83 lakh tons — over 13.64 lakh tons of rice, over 2.10 lakh tons of wheat and 12,074 tons of paddy.
Bangladesh Prime Minister Sheikh Hasina has asked all concerned to find a way out to ensure sustainable export growth and explore new global markets for Bangladeshi goods in the wake of the Russia-Ukraine war.
The Prime Minister made the call while speaking at the 11th meeting of the National Committee on Export, at her official residence Ganabhaban in Dhaka on Monday (20 March).
PM said, “Steps will have to be taken to achieve sustainable export growth after analysing situation steamed from the global economic recession due to the war in Ukraine,” she told the 11th meeting regarding export at her official Ganabhaban residence here.
The prime minister also urged all concerned to diversify the export items and explore new markets for those alongside revitalising the local markets.
“A new scope has been created globally to explore new markets for Bangladeshi items due to enhanced demands for goods because of the war in Ukraine. We have to grasp the markets,” she added.
The premier also called for formulating a new export policy for another 4 or 5 years by revising, changing and improving the existing one going to expire by 2024.
She said the new export policy should be adopted by analyzing the ongoing global economic recession, sanctions, counter-sanctions for the war and the challenges and scopes possibly to be created in Bangladesh after the graduation from the LDC by 2026.
Presently, the consumers will have to spend more money than usual in case of purchasing dates and other fruits—two essential items in iftar during Ramadan, due to importers’ difficulty in opening letters of credit (LCs) on time.
Price hike is a most common phenomenon ahead of the month of Ramadan in Bangladesh, and this year even more due to the LC opening crisis.
Already, the price of dates has doubled in the wholesale and retail markets and it will be more expensive ahead of Ramadan, said some businessmen.
The price of all types of dates has hiked in the local markets ranging from Tk 40 to Tk 160 per kg while different fruits range from Tk 30 to Tk 100 per kg.
Some traders said the prices of these essential iftar items will increase further during the month of Ramadan as they are facing difficulties in opening LCs which will push up the prices of dates and fruits.
According to the sources at Trading Corporation of Bangladesh (TCB), the price of dates increased by 20 percent compared to the last year.
Milton, a shop owner in the Baridhara area, said “The price of dates went more expensive in the past month ahead of Ramadan and I was able to purchase a limited amount of dates due to the soaring price of it.
He also feared that the price of dates would be soared further in the month of Ramadan.
Habibur Rahman, a fruit trader said the price of every fruit has increased.
Whatsoever, ajwa variety of dates is being sold at Tk 750-800 which was available at Tk 600-700 last year. Mariam variety of dates is being sold at Tk 800-850 while the premium variety of dates is being sold at Tk 1000-1200 per kg.
According to the statistics of Bangladesh Bank, the import of dates has fallen by almost half compared to the demands of it but during Ramadan the demand for dates is about 50,000 tonnes.
In the past three months, only 22,000 tonnes of dates were imported which is 46 percent less than the last year. However, the authorities concerned related to import dates have opened LC of 29,000 tonnes dates in January, said sources at Bangladesh Bank.
Sirajul Islam, president of Bangladesh Fresh Fruits Importers Association, said the demand for dates increases three to four times during the month of Ramadan. Besides, there is a demand of 50,000-70,000 dates in the country in a year while 40,000-50,000 is needed in Ramadan alone, he said.
Referring to the opening of LC, Sirajul said “This year the traders faced difficulties in opening LCs in time as they had to open it by paying 100% cash margin while it was 5 percent. The small traders are the worst sufferers in opening LCs.”
The dates are being imported from the Middle East and Africa and dates were being stocked five-six months before the Ramadan, he added.
He also said that the price of dates may increase 30 percent in Ramadan due to the dollar crisis and transport cost caused by the fuel price hike.
If the government will take steps in unloading dates in ports on a priority basis, then there will be no instability in the market, said Sirajul.
Contacted, Commerce Minister Tipu Munshi, said “We’ll take necessary steps so that the consumers can purchase dates, the most essential items in iftar, at a tolerable price.”
He also assured of keeping monitoring the market to prevent volatile price hikes of dates.
Issuing a warning, the minister also said strict action will be taken against those involved in increasing the price of dates after creating an artificial crisis.
The state-run Trading Corporation of Bangladesh (TCB) has taken an initiative to sell 6 essential items to some 1 crore low-income groups of families ahead of the holy month of Ramadan.
TCB will start selling 3 essential items – edible oil, sugar, dates and chickpeas and lentils—among such families from Thursday (March 9). These essential items will be sold in two phases. In the first phase selling of the items will start from Thursday across the nation.
Commerce Minister Tipu Munshi will inaugurate the sales of essential items formally through a function at Tejgaon in the capital on Thursday.
The cardholders can buy the six goods at subsidized rates from the TCB’s specific sales points and dealers’ outlets. Any cardholder can buy 2 litres of soybean oil, 2 kg lentil, sugar, chickpea and 1 kg date at a time. All the specific card holders can buy sugar at Tk 60/per kg, date at Tk 100, lentils at Tk 70, chickpeas at Tk 50 and soybean oil at Tk 110 per liter.
