Tk 1 rice price fall for Tk 6 duty cut

Prices of rice both in wholesale and retail markets have fallen only minimally despite the food ministry's claim that a reduction in import duty on the staple food would considerably bring down the prices.

The 18 per cent cut in import duty on rice has reduced the cost by Tk 6 a kilogram.

But, the rice price has decreased only by Tk 1 a kg in the markets. The traders have imported around 60,000 tonnes of rice, taking advantage of duty reduction, according to a monitoring report of the food ministry.

The ministry's report on daily food situation, published on Thursday showed that the price of rice had come down to Tk 45-47, Tk 1 less than the earlier price.

Meanwhile, wholesalers from different parts of the country claimed that the price of rice has decreased by up to Tk 2-3. The price will decrease further next week, they said.

Economists, however, said the poor start suffering whenever the price of coarse rice crosses Tk 40. In this situation, the government initiates open market sales of food item but this year OMS and other social safety net programmes remained suspended due to the shortage of stock.

The food ministry report said, the amount of rice in government warehouses till 6 July was 173,000 tonnes against 490,000 tonnes in the same period the previous year.

Meanwhile, the government has been able to procure a meagre 71,000 tonnes of rice till 6 July against the target of 900,000 tonnes.

Contacted, food minister Quamrul Islam told Prothom Alo on Thursday, “Rice imported from Vietnam would arrive in the country by the next week. Besides, rice import in the private sector is on the rise after the duty cut.”

As snowball effects of these steps, the prices of rice will decrease very soon, the minister hoped, adding that the government would begin the OMS programme within a few days.

Wholesalers of Badamtali market in Dhaka city said the prices of coarse and semi-fine rice, imported from India, have decreased by Tk 2-4 per kg and was being sold at Tk 40-42 a kg. But, the price of local coarse rice has remained almost unchanged, they added.

Shop owners at Karwan Bazar were seen selling rice at Tk 48-50 per kg. “We will be able to sell rice at new prices after we finish selling rice from the stocks,” one of them said.

* This report, originally published in Prothom Alo print edition, has been rewritten by Shameem Reza.