Farmers benefit from duty hike on rice imports
Paddy prices have increased at the growers' end as rice imports slumped owing to a duty hike earlier this month.
"Both demand and prices rose in recent weeks. It allowed me to earn more than what I used to get a month ago," said Mohammad Mokhlesur, a farmer at Adamdighi in Bogra.
He sold 50 maunds of swarna paddy, a relatively slimmer or medium variety of rice compared to the hybrid or coarse ones, at Tk 625 a maund, up from around Tk 600 a month ago. Prices of the thinner quality of paddy also rose, said millers and traders.
"The duty hike has benefitted me though the current prices will not bring me profits," the farmer said.
On December 8, the National Board of Revenue issued a notification, doubling the import duty on rice to 20 percent, in a bid to curb rice imports and protect the interest of the farmers.
Rice imports plunged 65 percent to 2.04 lakh tonnes year-on-year in July-December of fiscal 2015-16. It was 14.9 lakh tonnes in fiscal 2014-15.
The recent duty spike as well as good stocks at the government warehouses has had a negative impact on imports, said Nurul Islam, a rice miller and importer in Naogaon.
On December 27, the stock of cereals at public storages stood at 15.08 lakh tonnes, which is 17 percent higher year-on-year, according to food ministry data. Rice accounted for 75 percent of total food grain stocks.
"Farmers are getting better prices for paddy than before, following the duty hike," Islam said.
Md Layek Ali, general secretary of Bangladesh Auto, Major and Husking Mills Association, said purchases by millers to supply rice to the public godowns have also contributed to the recent paddy price hike.
The government earlier announced to buy two lakh tonnes of aman rice this season at Tk 31 a kilogram from December 15 to March 16.
The price is Tk 1 lower than the purchase price set last year, despite the fact that aman production costs increased from Tk 28 a kilogram last year to Tk 28.50 this year.
Nirod Boron Saha, a rice and paddy wholesaler and commission agent in Naogaon, said farmers would have got better prices had the government bought a higher quantity of rice.
Aman accounts for 38 percent of the annual rice output. The Department of Agricultural Extension targeted to ensure a production of 1.35 crore tonnes of rice during the current aman season, up from an actual production of 1.31 crore tonnes last year.
The government expects to meet the target for conducive weather, despite some early setbacks due to floods in the northern districts, according to a report by food planning and monitoring unit under the food ministry.