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A curious case of rice export

  • Published at 01:57 am July 16th, 2019
To give the farmers some relief from low paddy prices, the Food Ministry has announced direct procurement of 400,000 tons of paddy from the farmers Syed Zakir Hossain/Dhaka Tribune

Ministry says 100,000 tons of rice to be exported to the Philippines, traders say no agreement reached

One and a half month after the government’s announcement of a total of one million tons of planned rice exports to cushion domestic rice growers against the freefall in the staple’s domestic prices, there has been no move to this effect up until this Sunday last.

Interestingly, right after an impromptu meeting between a foreign importer, a local rice trader and the agriculture minister yesterday, the ministry’s public relations officer (PRO) Md Giasuddin announced the Philippines would import 100,000 tons of rice from Bangladesh.

But the Managing Director of Rashid Group, Md Abdur Rashid, who was present at the meeting, told Dhaka Tribune that no agreement was reached at the meeting as the importer offered a price ($385 per ton) well below “our asking export price of $525 a ton.”

And the person who showed interest in importing rice from Bangladesh for the Philippines is a Belgian national – Marc Cools – who went to the Philippines in 2003 to establish a lighting business – Hitech Lighting World Corporation (HLWC).  

This correspondent tried, unsuccessfully, to reach Agriculture Minister Dr Abdur Razzaque but his ministry PRO insisted that the Philippines would indeed import 100,000 tons of rice from Bangladesh. Asked when that export consignment would leave for the Philippines, he couldn’t offer any timeline.

He said Rashid Group’s MD Md Abdur Rashid, Executive Director Md Zahirul Huq and HLWC’s Bangladesh representative, Samsul A Syed, were present during Marc Cools’ meeting with the minister.  

Amidst low paddy prices during peak rice harvesting season in April-May this year, the government had indicated it would give private rice traders up to 30% incentives on exports and increased the duty on foreign rice from 28% to 55% to discourage imports.

But neither the public nor private rice sectors in Bangladesh have so far had any luck in finding an export market for the surplus rice. High domestic output and cheaper imports from across the border have created a rice glut, compelling farmers to sell rice at much lower prices in the Boro season.

To give the farmers some relief from low paddy prices, the Food Ministry announced the direct procurement of an additional 250,000 tons of paddy, on top of the initially planned procurement of only 150,000 tons.

But over two and half months after the public food grain procurement drive began, the government has bought only one fourth of the total of 400,000 tons of paddy it intended to buy from farmers.