Want to keep hunger at bay? Invest more in farmers
Food prices are sky-high and concerns over future supplies are deepening as the Russia-Ukraine war intensifies. Global wheat prices have marked a fresh rise. Though wheat is our second basic food, the grain feeds a booming food industry, and local production meets less than 20% of its demand. We import only 2.5% of our rice consumption. Yet, the impact of the global rice market cannot be ignored. Aman crop took a blow from the latest cyclone after low rainfall.
The war made fertilisers costlier and their supplies uncertain. The next Boro crop is facing supply concerns for fertilisers; expensive diesel makes irrigation and high labour even costlier. Scope for imports, in case of any emergency, also does not look bright as major producing countries have resorted to protectionism to ensure domestic food supply. The world's largest rice exporter India, our traditional source, in September restricted rice exports to offset crop loss feared from low rainfall.
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The Indian move will prompt Vietnam and Thailand – two other major exporters – to hike prices too, an earlier Reuters report predicted. As the food future looks gloomy amid worldwide fears of hunger, gaining self-sufficiency in food and reducing import dependence can shield us from future odds. The prime minister has repeatedly cautioned that a famine-like situation looms large and urged farmers and landowners not to leave even an inch of arable land uncultivated. But farming land requires timely supply of inputs at affordable prices as well as fair prices of farm products. Farmers need to be insured against any crop failures from extreme weather events – a long-promised support that has remained unmet.
These are among the issues focussed by experts who our Senior Correspondent Jahidul Islam could reach.
Identify and support really vulnerable groups
Dr Mohammed Asaduzzaman, Former Research Director, BIDS
There are two issues concerning food security.
First, availability – meaning you need to have food in the country whether by imports or internal production. Rice is basically dependent on domestic production, but wheat, our main cereal after rice, is practically entirely dependent on imports.
Secondly, other nutritious items such as vegetable oil are also largely import-dependent. Lentil, for example, is brought in from either Lebanon or Cyprus, or other countries. Sugar is also import-dependent.
Access to food is a big issue here. Those who produce have direct access to food. But 99% of us are non-producers and have to buy food items from the market.
People's purchasing power has weakened because of soaring inflation. Prices have shot up for various reasons that we all are well aware of, so I do not want to discuss them. But the more important thing is that we never really tried to address the reasons for market volatility, we just thought that only producing more food would do it for us.
Ministers and others in the government are often heard saying Bangladesh is self-sufficient in food. In reality, we are faring somewhat well only in rice, but we are self-sufficient in nothing else.
We are not sure about the availability of food and do not have access to them as well. And adding to people's woes, the government has increased energy prices. Now even well-off people are worried about the excessive energy prices.
Therefore, it is obvious that people are decreasing food consumption. They cannot cut spending on the education of their children, but they save on food. Perhaps, parents are eating less to provide for their kids.
The prime minister herself has expressed worries about a looming famine. I believe the famine may not come right away, but it may take five to six months.
Think about it, you could not fare well in Aman cultivation for lack of rain. And then came cyclone Sitrang. This cyclone has caused huge damage. A day before the cyclone, the authorities advised farmers to harvest paddy if they are 80% ripe. Could they not say this five days earlier?
If the government wants to ensure access to food for all, it must provide support to many sectors. Does the government have that capacity?
In Kolkata, one can purchase even 100 grams of fish as per their requirement, but we have to purchase an entire fish here in Bangladesh. Similarly, we cannot purchase 200 grams of chicken here. As a result, here, maybe a parent has the capacity to purchase 200 grams of chicken for their kids, but they cannot have it. Thus, there is a massive crisis in our country in terms of access to food.
So, what should we do now?
We have to identify the really vulnerable groups and support them.
Food stock should be increased to lower prices
Dr Jahangir Alam Khan, Agricultural economist, former member director of BARC
The shortage of materials due to a supply chain disruption during the Covid-19 pandemic hindered food crop production in various countries around the world. Then the Russia-Ukraine war has further disrupted both the food production and supplies.
The aftermath of the pandemic and various sanctions following the war has been a food crisis in Bangladesh like many countries of the world. Food prices have also been rising for the same reason.
On one hand, the prices of all kinds of products are increasing and, on the other, people's incomes have reduced, shrinking their ability to purchase necessary food due to the economic crunch.
In short, production, supply and access have decreased.
In the meantime, long drought in many countries of the world has further disrupted crop production. Then in many countries, including Pakistan, there has been crop damage due to floods. Overall, the global food production may decrease by 1% this year.
With forecasts of drought and flood, food production may decline further next year. Currently, about 800 million people in the world are in a food crisis. The number may rise to 1 billion next year. If this happens, we may be looking at a major global famine.
Although Bangladesh's import of rice is relatively less, we have to import a large amount of wheat and corn. If Bangladesh needs to import some 80 lakh to 1 crore tonnes of food from the world market to meet the demand, the country will feel the heat of this crisis.
As a result, Bangladesh will also face a food crisis. In case of a global famine, Bangladesh will not be able to stay out of it. I say this considering the global market situation.
If we look at our domestic production, we can see that our Aush cultivation has suffered somewhat due to the prolonged drought. Due to the need for irrigation, the cost of cultivation has also increased. However, due to relatively good rainfall, Aman cultivation is improving.
At this time, if the production of winter crops, especially potatoes, is good, and if the Boro yield this season is good, it may be possible to avoid a major crisis.
Now, the problem is that our fertiliser prices have gone up. During the Boro season, the entire crop requires irrigation, with 80% of it dependent on diesel. Due to increase in diesel prices, the cost of irrigation will increase at a drastic rate this time. Meanwhile the prices of all types of seeds have also increased by 20-30%.
It is said that production should be maximised without leaving even an inch of land fallow. On the other hand, the farmers are being discouraged by increasing the price of agricultural inputs.
Among these, the biggest crisis is not being able to ensure fair prices for crops during the production season. If agriculture cannot be made profitable, the question will arise whether people will be fully self-employed in agriculture or not.
If the price cannot be guaranteed during the production season by reducing the influence of the middlemen, we will see at some point that the farmers will cultivate only to meet their own needs. Once this trend starts, it will become impossible to ensure food security.
A quarter of people in Bangladesh are already malnourished. It is not just because of lack of food supply – many are unable to buy enough food due to lack of income.
Although the production of various food products including milk, eggs and meat is increasing, the prices are not decreasing. That is why productivity should be increased to reduce food prices. For this purpose, new technology, innovation of high-yielding varieties, and mechanisation should be given importance.
In addition to controlling food prices in the market, the government should increase the scope of food-friendly programs to ensure access to food for the poor.
To do this, the government needs to increase its food stock. If the government has sufficient reserves, traders cannot take advantage of the crisis to raise prices.
I said earlier that there is no shortage of food in the country at this moment. To reduce the price by interfering in the market, the government should increase the stock.
To transition from the food crisis, production, per capita demand as well as national demand must be taken into account to decide how much food to import.
There are large differences in food production data from the government's Ministry of Agriculture and the Bureau of Statistics. Again, taking into account the per capita consumption data, a large part of the domestic production should be derived.
Due to lack of proper information on this matter, food shortage remains. Before making a long-term plan to eliminate the food crisis, complete data must be collected.
Continued power, diesel, fertiliser supply can tackle food crisis
ANWAR FAROOQ, Former Secretary, Ministry of Agriculture
Our food situation is relatively better than other countries in my opinion. Bangladesh is no longer in a situation where we will fall into trouble if there is a problem anywhere in the world.
If the government ensures the supply of electricity, diesel and fertilisers and there are no major natural disasters, the food shortage, being talked about globally due to the Ukraine-Russia war, will not touch Bangladesh.
Even if there is no crisis in our staple food rice, there will be problems in wheat, maize, edible oil and sugar. All these items have to be bought at higher prices due to increase in prices in the world market and depreciation of money.
To deal with this crisis, the government should give maximum importance to agricultural production. Electricity supply for irrigation needs to be ensured. There will also be no shortage of fertilisers as Muriate of Potash (MOP) fertilisers are guaranteed from Canada. However, due to the diesel price hike, irrigation will become a problem. The government should increase support for agricultural materials including diesel.
All farmers are getting the incentives in fertiliser given by the government. However, a crisis started when many dealers sold huge quantities of fertilisers taking advantage of weak monitoring. The government should increase its vigilance in this sector.
The initiative of the government in providing electricity to irrigation is commendable. Electricity has been provided for irrigation, even by implementing load shedding in the capital, if necessary, since 2010-11.
But in order to get good yield, the supply of diesel should be increased and the price should be reduced. If the price is not reduced, the price of rice may increase by at least Tk10 per kg.
Meanwhile, the prices of all types of seeds have increased and government organisation Bangladesh Agricultural Development Corporation (BADC) is also in competition for this increase. At a time when the country's agriculture is going through a period of transition, it is not right to put pressure on the farmers without increasing the support from the government.
Agriculture as a profession or business is very risky so all types of crops should be covered under insurance. First priority should be given to low-lying areas, hoards and disaster prone areas. For the first few years, the government should encourage the farmers by paying the premium.
Farmers are not getting the real price of their crops due to flawed procurement policy of the government. If the production of paddy is about 3 crore tonnes, the government cannot buy even 3 lakh tonnes. But the government buys at least 20% of the total production in neighbouring countries.
As our government buys rice from the market, the millers enjoy the full benefit. Farmers would get some extra money if they collected paddy during the harvesting season. Irrigation, cultivation and payment of dues to labourers would also be easier.
When asked about this, the government says we do not have a warehouse. It does not take years to increase the number of warehouses. This can even be done by renting vacant warehouses from the private sector.
Farmers get a fraction of the price of other crops, especially vegetables. As they have less access to the main market, they have to sell products at lower prices. In order to reduce the post-harvest loss in this sector, the storage system should be improved along with the development of marketing channels.
Many times, due to extortion on roads during transportation goods are sold in the market at higher prices, although the farmers do not get the price. This must be stopped.
Finally, efforts should be taken to reduce wastage of agricultural products. It is impossible to increase production by 5% due to the scarcity of land. However, more than 10% wastage can be reduced if we are diligent.
Private rice imports low due to losses
Layek Ali, General Secretary, Bangladesh Auto Major and Husking Mill Owners Association
Importers are not that enthusiastic even though the government has slashed the duty on private-sector rice imports. The main reason for this is no profit.
Importing rice is not profitable now due to the US dollar rate hike. After import, the prices of rice stand equal to or even higher than the prices in the domestic market.
That is why only 2.51 lakh tonnes of rice were imported in a few months despite the government giving a permit for importing 14.92 lakh tonnes at the private level.
Most of Bangladesh's rice imports come from India. But when Bangladesh cut tariffs twice amid the dollar crisis, India banned the export of rice entirely to secure its own food stock.
At the same time, it imposed an additional 20% duty on the export of milled and pounded rice. However, exports of boiled milled rice and basmati rice are kept out of this additional duty.
Because of this decision, Bangladesh had to pay a higher price while importing the grain and the prices are eventually getting even higher than the prices of domestic grains.
That is why importers are facing hurdles to sell rice and incurring either losses or low profits. This has become a big challenge for them. But for the sake of food security, import is necessary now.
So far, the government has maintained its stock by bringing 6 lakh tonnes of rice from different countries under the government-to-government (G2G) system.
Along with private imports, the domestic production of rice is also being hampered. Millers are facing disruptions due to frequent load shedding, production dropped by a substantial margin.
As the production volume drops, the production cost is rising because the expenses for full-capacity production remain as usual. As a result, rice prices are high in the market.
But since the demand is slightly low in the market, the production gap is yet to become a major issue. Besides, the government is distributing rice extensively through open market sales (OMS) and food-friendly programmes, taking the edge off the demand for milled rice.
