Food costs for the poor rises by 58pc

Abdur Rahim was selling vegetables in the Kamarer Gali area of East Kazipara. He was selling pointed gourds (potol) at a rate of Tk 15. Hearing the price, the buyers thronged in front of his van only to learn that the rate was actually Tk 15 per 250 gram, not 1 kg.

Abdur Rahim says selling vegetables by 250 grams or half a kg has become a norm. Only a few people have the ability to buy a kilogram of vegetables now.

The World Food Programme (WFP) has published a report on the food cost situation this month in Bangladesh. It says that according to the household survey, the average per head food cost for people below the poverty line was Tk 1,851 in 2022. The prices of food products have gone up over the last two years. The per head food cost for people below the poverty line rose to Tk 2,923 last February, which is 58 per cent higher than the food cost two years ago.

According to official and unofficial accounts, although people's income increased in the last two years, the inflation rate constantly remained around 10 per cent.

Overall, the prices of main food items in the country rose. In particular, the prices of rice, flour and main sources of protein – chicken, eggs, fish and vegetables are on the rise. Besides, the prices of daily essentials like potatoes, onions, ginger and green chillies have also gone up.

Speaking to Prothom Alo, executive director of the Institute for Inclusive Finance and Development, Mustafa Kamal Mujeri said there have been some developments in the food supply system. There is no food crisis. However, some quarters in the market management system have become increasingly dominating. The government is trying to contain price hikes by fixing prices of products. But it won’t yield any effective outcome. Such initiatives never benefit the market economy.

He said, “We have to make our market competitive and justified. There should not be any opportunity for the influential quarter to control the market unlawfully.”

The WFP published another report in April on the impact of the rise in the prices of food products. It says some 17 per cent people were under food insecurity in last February, which was 2 per cent higher than the previous month. Besides, some 68 per cent people are trying to cope with the situation through cost cutting, 43 per cent people are buying food on credit, 22 per cent people have lessened their medical costs and 13 per cent people are surviving on their savings. Only 21 per cent of the people under food insecurity are getting assistance.

The WFP report on the market situation this month says the rise in the per head food cost is different in different divisions. The per head food cost was higher than the national average in Dhaka, Chattogram and Sylhet. The rise in per head food cost was comparatively low in Rangpur, Rajshahi and Mymensingh. The prices remained almost the same in the remaining parts of the country.

The report further says the prices of various varieties of rice were on the rise throughout the month of February. The price of Aman rice increased despite a six per cent surplus production this season. The rice mill owners have blamed the rise in the production cost behind such high prices of rice. The price of coarse rice increased by seven per cent last year. Now the price of coarse rice has crossed Tk 51, which is 57 per cent higher than its price before the pandemic.

The price of wheat has been falling gradually in the international market for the last six months. There wheat import has increased. Despite that, the price of wheat hasn’t fallen. The retail price of coarse flour has reached Tk 57 per kg. The country imports 85 per cent of the demand for wheat.

According to the WFP report, the government food stock has been on decline since the beginning of this year, which is not uncommon as the stock usually remains low at this time of the year. However, the government food stock was unusually low this year as compared to the past. The government food stock was 1,560,000 tonnes in February, including 13,300 tonnes of rice, which is 17 per cent lower than previous year.

The government stock has further dwindled in the last two months as updated by the food ministry. The total government food stock was some 1,112,420 tonnes on 15 May, including 751,325 tonnes of rice and 351,000 tonnes of wheat.

The stock is dwindling as the supply of rice and wheat increased under the social safety net programmes. However, the food ministry is expecting the stock to increase once the collection of Boro rice begins from June.

The WFP has published a report on the food situations in Asian and Pacific countries. The report highlights the change of food situation in these countries since 2019. It says the food management of Bangladesh has gone through multifaceted problems, it said adding that food import to Bangladesh declined exponentially following the start of the Russia-Ukraine war. Before, the country’s overall food production increased gradually from 2010 to 2016. Apart from this, the production of livestock increased continuously from 2010 to 2021.

Speaking to Prothom Alo, food minister Sadhan Chandra Majumder said, “The food production rate is quite satisfactory. However, the rice production cost increased in the face of the rise in the price of agricultural products and equipment, including fertiliser and fuel oil. So if we want to lower the prices of rice, then the farmers will produce less rice. Then we will have to depend on the international market for rice.”

The WFP figure shows that the food inflation reached around 8 per cent in 2013-14, which was around 3.4 per cent in the previous years. The food inflation started rising rapidly from 2023 and reached 13 per cent by October that year.

The prices of rice increased by some 75 per cent as compared to 2017 and the prices of energy-providing foods increased by 25 per cent. Besides, prices of almost every daily essentials, including rice, wheat, sugar, edible oil, fish, meat, chicken, vegetables, milk and eggs, also went up.

*This report appeared on the print and online versions of Prothom Alo and has been rewritten in English by Ashish Basu.