Bangladesh Rice Farmers Face Double Whammy With Lower Prices And Higher Supplies

Bangladesh rice farmers are not happy despite the country achieving record 34.708 million tons production (milled basis) in FY 2014-15 (July - June) due to prevailing low prices, according to local sources.

They are the current prices are not even sufficient to cover their production costs. Most of the farmers are receiving Tk 460 per 40 kilograms (around $145 per ton) for hybrid and high-yielding varieties, about 20% lesser than the production costs.

Farmers have been complaining of lower prices since April this year due to increased local production and higher imports from India. The country reportedly imported about 1.45 million tons of rice during FY 2014-15, about four times more higher than in 2013-14, despite a record production due to prevailing low global rice prices, according to the Ministry of Food. They told local sources that the total availability of rice has crossed the local consumption demand of around 3 million tons and has put a downward pressure on prices.

Also farmers and traders are mainly concerned that increased imports have lowered demand for local rice further pushing down the prices. Average price of coarse rice currently stands at around Tk 30-34 per kilogram (around $377-$428 per ton), compared to around Tk 32-37 per kilogram (around $402-$465 per ton) in April this year and around Tk 35-38 per kilogram (around $440-$477 per ton) during the same time last year, according to data from Trading Corporation of Bangladesh.

They noted that the imposition of 10% duty on rice imports did not provide the desired effect as the Indian suppliers lowered their rates. They are expecting the current floods that are affecting some rice growing areas to push up the prices to some extent.

Floods that are a result of heavy rains have damaged more that 260,000 hectares of Aman crop land, local sources quoted the Department of Agricultural Extension (DAE). Farmers are reportedly encouraged to grow flood-tolerant rice varieties such as BRRI dhan51, BRRI dhan52, BINA dhan11 and BINA dhan12 to ensure that the production is not impacted.

USDA estimates Bangladesh’s MY 2015-16 (July 2015 – June 2016) milled rice production at around 35 million tons, slightly up from an estimated 34.5 million tons in MY 2014-15. It estimates Bangladesh to import around 1.2 million tons of rice in 2015.   

Source:- Oryza.com