THE government has started importing rice amid continued refusal of local millers to supply the staple despite legal obligation. The decision to import rice in December when Aman harvest reaches its peak is set to take a toll on farmers by lowering further the existing price of Aman paddy while they are not even fetching the production cost.
Economists found no justification for rice import when largely impoverished local growers are losing their investment thanks to a food supply chain fraught with corruption and poor procurement mechanism. Due to this farmers would face further fall in the price of Aman although they committed no error for depleting public food stocks.
The government’s action is thus a policy error that would only benefit vested quarters and hurt farmers due to the actions of the local millers who have reneged on their deal during Boro procurement which led to the government’s failure to procure only Boro rice which is mostly stocked by millers.
This precipitated a steep decline in government stocks causing the government to have half the required number needed for safety. The actions taken by the government against the millers after poor Boro procurement apparently made no impression as they refused to supply Aman to the government too.
Nearly half of farmers are so poor that they do not possess any farmland and they cannot afford to wait after harvest as they have no place to store rice. They are forced to sell 60 per cent of their paddy in the first month after harvest. In economically stressed condition farmers are forced to let go of their produce even faster. Farmers are in unprecedented economic stress after going through multiple floods amid the coronavirus crisis since March.
The Department of Agricultural Extension calculated that farmers spent more than Tk 27 for producing a kilogram of paddy this year after flood destroyed many of their rice fields multiple times. Bangladesh Rice Research Institute estimates that the market price might fall by Tk 2.5 per kilogram because of the import.
Agricultural economists have long demanded that the government buy paddy directly from farmers. But the government has always cited the lack of milling capacity for mostly buying rice from millers. The limited direct procurement of the government from farmers is fraught with many problems. Farmers are often returned for failing to supply paddy at the right moisture level or unless they bribe food officials. Paddy changes three layers of middlemen before it reaches millers with its price soaring at every layer. So the government should have reformed its procurement mechanism and strengthened the food chain instead of finding a solution in rice import which would only hurt our farmers.
