Paddy prices rise on supply crunch
Paddy prices have shot up amid a short supply from farmers, influenced by speculation over low Aus output, and delayed and reduced production of the second biggest rice crop -- Aman.
In the last two weeks, prices of paddy, depending on variety and quality, have increased by Tk 30-Tk 50 a maund (37.32 kilogram), said KM Layek Ali, convenor of Bangladesh Rice Mill Association, a body of 17,000 rice mills.
“It seems that the farmers are less interested to sell their stocks on assumption of poor and delayed Aman harvest,” he said yesterday.
The speculation over poor harvest of Aman deepens because of delayed plantation of green shoots in the north, amid low monsoon rains in June and for half of July.
Low rainfall, creating a drought-like situation, has also dampened the prospect of a good output of Aus, cultivation area of which also declined this year compared to a year ago.
Agriculture officials said sufficient rainfall and irrigation facility later helped the farmers plant Aman in much of their land.
But worries of losses have returned in the wake of inundation of about 1.40 lakh hectares of low-lying crop fields in greater Rangpur and Rajshahi region.
Flood has also created a concern over losses, said Layek.
“Many farmers who have counted losses may switch to potato cultivation instead of planting Aman again,” he said.
The recent inundation is also feared to damage a portion of Aus crop, harvest of which is yet to complete.
“Drought has affected Aus output. Delayed plantation of Aman is also likely to delay its harvest. These all have caused a drop in paddy supply from the farmers,” said Nirod Boron Saha, general secretary of paddy and rice wholesalers' association Naogaon Dhan-Chal Aratdar Babosayee Samity.
Figures about the rise in paddy prices, as cited by the traders and millers, vary depending on areas.
Nirod said price of coarse paddy (hybrid variety) now hovers around Tk 410-Tk 420 a maund, up from Tk 360-Tk 370 two weeks ago.
Price of medium quality Pariza rose to Tk 420-Tk 430 a maund from Tk 370-Tk 380.
“Big farmers are now benefiting the most, while small and marginalised farmers fail to grab the chance,” Nirod said.
But rice market is yet to feel the impact of increase in paddy prices, he said. “Whatever rise we see in rice price is marginal.”
Md Shahin Alam, a paddy and rice wholesaler in Bogra, said the millers are showing more interest to buy paddy now, while the farmers are supplying less.
“Demand is higher than supply and that's the reason for the rise in price. Many millers who once showed a little interest to paddy, now want to buy,” said Shahin, who supplies paddy to rice mills.