Traders in Bangladesh are facing obstacles in importing rice due to a combination of global price upturn, duties, and the appreciation of the dollar. Despite government permits being issued to importers, the rising prices of rice worldwide, particularly in neighboring India, have made the move almost futile.
The food ministry had granted permits to 80 importers in March and April to bring in a total of 0.284 million tonnes of rice. However, the deadlines for these permits have passed, and no traders have been able to open LC for imports. The minimum import cost for rice is now higher than the price of Bangladeshi rice, making it financially unfeasible for traders.
One importer, Abul Kalam, highlighted that Indian parboiled coarse rice would cost over US $600 a tonne, including duties on both sides of the border. The Indian government has also restricted food exports following their national elections, further complicating the situation.
The appreciation of the dollar by 6.3% has also deterred importers, as it now costs more to source a dollar. With rice prices surging globally, including a 9.2% increase compared to last year, traders are facing challenges in the market.
Despite Bangladesh having a surplus of rice, mismanagement in the market and post-harvest losses contribute to market volatility. Retail prices of rice remain high, with different varieties selling at various price points in Dhaka.
Experts suggest proper management of local rice resources and a successful government procurement drive to stabilize the market. The country’s demand for rice is around 33-34 million tonnes, while production stands at 37 million tonnes, indicating a surplus. However, effective measures are needed to address the challenges faced by traders and consumers in the rice market.