The illusion of food self-sufficiency

In October 2020, at a seminar organised by Farming Future Bangladesh and Bangladesh Institute of Research and Training on Applied Nutrition (BIRTAN), Agriculture Minister Dr Md Abdur Razzaque said Bangladesh had achieved self-sufficiency in food over the past decade. In June 2022, at another event, he again said the country had achieved self-sufficiency in food under the leadership of Prime Minister Sheikh Hasina. Earlier in 2019, Food Minister Sadhan Chandra Majumder said the same.

But in February 2022, when the prices of oil, sugar and lentils increased in the domestic market, Commerce Minister Tipu Munshi justified the price hike saying it had happened "due to the increase in prices in the international market."

It is quite a paradox. If the country is self-sufficient in food, price hikes in the international market should not affect the domestic prices. Conversely, if price hikes in the international market cause price hikes in the country, then we cannot say that the country is self-sufficient in food.

Some may say when the ministers talk about self-sufficiency in food production, they may be referring to food grains only. But Bangladesh is not self-sufficient in grain production either. According to the Bangladesh Food Situation Report (Volume 131, October-December 2022), Bangladesh imported 988,000 metric tonnes of rice and four million metric tonnes of wheat in 2021-22. In 2022-23, rice and wheat imports are projected to be 1.71 million and 3.2 million tonnes, respectively.

According to the latest quarterly global report of the United Nations Food and Agriculture Organization (FAO), Bangladesh has to import more than 10 million tonnes of cereals annually; in FY2021-22, the amount was 10.4 million tonnes (Pg 42). And per the data provided by the Bangladesh Bank, we import food products worth about $5-7 billion every year. In FY2020-21, Bangladesh imported wheat worth nearly $1.83 billion, rice worth $850.9 million, milk and cream worth $344.1 million, spices worth $404.4 million, edible oil worth $1.92 billion, pulses worth $681 million, and sugar worth $799.7 million. Thus, the total cost of importing these food items in FY21 was $6.83 billion. In FY22, this import cost increased by 22 percent to $8.34 billion.

There are many food items that are produced in the country, but the raw materials needed for production have to be imported. For example, 50 percent of the maize and 90 percent of soybean required to make poultry feed have to be imported. That's why when the price of maize or soybean increases in the global market, it creates an upward pressure on poultry prices in the local market.

Food self-sufficiency cannot be achieved by maintaining such dependency on the international market for food production. While reality can sometimes be denied during normal times, doing so can lead to dangerous situations during a crisis. Price hikes in the international market increases import costs abnormally and puts pressure on the forex reserves. Moreover, food is such a strategic commodity that, in times of crisis, it cannot be imported even by spending additional money. Also, imports of essential food items cannot be reduced suddenly because the domestic production cannot be increased overnight.

Also, as Bangladesh needs to import 80 percent of the chemical fertiliser needed to grow crops, the foreign exchange reserves come under pressure when fertiliser prices spike in the international market. Due to the shortage of gas required to produce fertiliser and a lack of proper maintenance of the state-run fertiliser factories, this import dependency is increasing, and so is the pressure on our forex reserves. As per Bangladesh Bank data, the cost of fertiliser import for Bangladesh increased more than three times, from $1.36 billion in 2020-21 to $4.39 billion in 2021-22, which in turn pushed fertiliser prices in the local market upwards. In August 2022, the government increased the price of urea fertiliser by 37.5 percent, burdening the farmers with an increased production cost.

Food self-sufficiency cannot be achieved by maintaining such dependency on the international market for food production. While reality can sometimes be denied during normal times, doing so can lead to dangerous situations during a crisis. Price hikes in the international market increases import costs abnormally and puts pressure on the forex reserves. Moreover, food is such a strategic commodity that, in times of crisis, it cannot be imported even by spending additional money. Also, imports of essential food items cannot be reduced suddenly because the domestic production cannot be increased overnight. Since the amount of agricultural land in the country is limited, specific plans and initiatives are needed to determine what kind of crops will be produced in this limited agricultural land, which ones need to be increased, and which ones need to be reduced.

Since policymakers in Bangladesh like to believe that the country is self-sufficient in food production, there is no emphasis on the long-term strategic plan to increase import-substituting food production. When the price of a particular food item increases in the international market, they ask the farmers to increase the production of that food item. For example, if the price of onions increases in the international market or when India bars onion exports, the price increases in the local market, and the government says onion production needs to be increased domestically. This cannot be an example of a good strategy.

To solve a problem, one first needs to acknowledge it. The government must first admit that Bangladesh is not self-sufficient in food production. Then a decision has to be made as to how the limited amount of land that we have for agriculture can be utilised optimally to produce what types of food, and the necessary incentives and support that should be provided to this end. For example, in order to reduce the import of sugar, proper incentives should be given to sugarcane growers and the state-owned sugar mills should be utilised to their full capacity instead of keeping them closed down. In order to reduce the imports of edible oil, the potential of cultivating sunflower, soybean, groundnuts and mustard should be explored. A choice has to be made between continuing to increase the salinity of land in coastal areas to produce shrimp for export and increasing cultivation of various import-substituting food crops in those areas. Moreover, initiatives can be taken to increase the production of import-substituting food by reducing the cultivation of crops like potatoes, which are sometimes produced in surplus.

None of these options can be realised by making decisions at the individual level. This requires long-term and coordinated planning from our policymakers. But that won't be possible unless the illusion of food self-sufficiency is overcome.

Kallol Mustafa is an engineer and writer who focuses on power, energy, environment and development economics.