An increase in imports from India as well
as the low demand from millers due to the ongoing blockade is forcing
rice farmers to sell the crop at lower prices than last year. Photo:
Star/File
Prices of paddy -- mainly medium and coarse grains -- have fallen by Tk 70-Tk 80 a maund (40kg) in more than two months, since the harvest of aman paddy in December, farmers and millers said.
"Paddy prices usually go up at this time. But the market is behaving just the opposite this year," Hafizur Rahman Dilu, a farmer from the southwest district of Bagerhat, told The Daily Star by phone.
With hopes of getting better prices, the 35-year-old farmer did not sell his coarse paddy despite getting an offer of Tk 670 a maund from a trader last month.
However, prices plummeted and Dilu had to sell his stock of 150 maunds of paddy at Tk 630 a maund last week.
"Traders are unenthusiastic about buying paddy due to shutdowns and slow demand at mills."
Paddy of the same quality sold at Tk 700 a maund at the same time last year and they made some profit, he said. However, he was unable to make a profit this year as he had to pay more for pesticides and labour wages.
Farmers grew aman paddy on 54 lakh hectares last season and harvested a good crop, according to agricultural extension workers, growers and millers.
Chitta Majumder, a rice miller, said prices of medium and coarse grains were higher during the aman harvest. But prices fell gradually since the end of December, by up to Tk 100 a maund, he said.
"The main reason behind the fall is a rise in imports, particularly from India. The ongoing blockade has also affected the market."
Rice imports hit a four-year high as traders find foreign produce, mainly from India, cheaper.
Private traders imported 8.75 lakh tonnes of rice between July 1 last year and March 4 this year, the highest since fiscal 2010-11. The government did not import any rice during the period, according to food ministry data. Majumder said prices of coarse paddy, such as guti swarna, have now dropped to Tk 600-Tk 650 a maund from more than Tk 700 after the aman harvest in December.
"The demand for local coarse and medium rice dropped due to imports. So, no rice mill is willing to purchase coarse paddy amid worries of stockpiles for low demand," said Majumder, also a rice importer.
Rice millers are already stuck with unsold stocks of locally grown coarse and medium rice because of higher demand for imported rice, he said.
"If the situation continues, rice and paddy prices will decline further after the start of the boro paddy harvest," Majumder said. Farmers will begin harvesting boro, the main crop, by the end of next month.
"Farmers still have a huge stock of coarse paddy," said ASM Sishnabi Mandal, a grower from Dinajpur. Only the price of scented rice has gone up, he added.
Nirod Boron Saha, president of an association of rice and paddy wholesalers at Naogaon, said paddy prices fell by Tk 70-Tk 80 a maund since the end of aman harvest.
"The sluggish demand for locally grown coarse and medium rice means that a huge amount of paddy and rice will remain unsold with big farmers, stockists and millers."
Saha said increasing imports might push prices of rice and paddy further down and affect farmers.
"It will be tough for farmers to recover their investment. The recent paddy harvests were good and the government should discourage imports for the sake of the farmers."
Bangladesh produced 3.44 crore tonnes of rice in fiscal 2013-14, up from 3.38 crore tonnes a year ago, according to Bangladesh Bureau of Statistics.
Production was higher than the domestic food grain requirement of nearly three crore tonnes, according to an estimate by Bangladesh Institute of Development Studies.
The government also claims that the country has achieved self-sufficiency in rice production.
Saha said any supply in excess of demand puts downward pressures on prices. "We are seeing this effect.”
