People’s purchasing power fell due to inflation and it left a negative impact on the demand for food products. The same is applicable to the Ramadan commodities.
The dollar crisis and subsequent restrictions in letter of credit (LC) had slowed down import of food commodities for several months. The situation improved in February as the government asked the banks to open LCs involving import of Ramadan commodities in January.
According to an analysis of import data and market prices, commodities that suffered a blow in their imports have already become pricier before the commencement of Ramadan. And the products that witnessed no significant change in imports have either been stable, or registered a price fall.
Abul Bashar Chowdhury, chairman of BSM Group, said the wholesale markets usually go through a pressure in commodity sales before Ramadan. No such pressure is felt this year. Moreover, the demand for Ramadan commodities slumped this time while some witnessed price fall.
“There will be no problem this year despite the decreased imports,” he added.
Lentils price falls despite low imports
The demand for chickpeas, lentils, peas, edible oil, sugar, and flour generally rises in Ramadan. Traders start importing Ramadan commodities around two and a half months before the commencement of the holy month.
According to import data, some 157,000 tonnes of chickpeas have been imported in two and a half months of the current year, when the quantity was 165,000 tonnes in the previous year’s corresponding period. There was a crisis in import of chickpeas until the previous month, but the situation improved after starting imports from India.
Besides, the import of peas decreased roughly by 50 per cent from 152,000 tonnes to 76,000 tonnes in the same period. Bangladesh had imported 143,000 tonnes of lentils in the first two and a half months of the previous year and the import volume declined to 121,000 tonnes this year.
Sanjay Dev, proprietor of Suman Trading, pointed out two reasons behind the fall in pulse prices. Firstly, the people are struggling to deal with the high commodity prices and it has pushed down the overall demand for daily necessities. Secondly, there is nothing to worry about a fresh hike in pulse prices as it has been imported from India this time.
Edible oil price drops in wholesale markets
A total of 121,000 tonnes of soybean oil have been imported in the first two and a half months this year, against an import of 119,000 tonnes in the previous year’s same period.
Despite the increase in soybean oil, it registered a slight fall in refining and marketing. A total of 102,000 tonnes of soybean oil have been marketed during the period this year, when the quantity was 193,000 tonnes in the previous year.
Palm oil also has witnessed a similar scenario.
Shahed Ul Alam, proprietor of RM Enterprise at Khatunganj market in Chattogram, said the soybean and palm oil prices have been on a downward trend in the wholesale markets. Soybean oil registered a price decline of Tk 5 within 10 days while palm oil Tk 4.
The import of sugar almost halved this year, but no crisis created there owing to decreased demand, according to traders. Apart from that, the flour price has long been high in the markets and its import also fell to some extent.
Also, a slight drop has been recorded in import of dates as the import volume, which was 37,000 tonnes in the previous year's first two and a half months, fell to 35,000 tonnes this year. The retailers have raised the regular date price by Tk 10 and Ajwa date price by Tk 100 per kg.
Faruk Ahmed, proprietor of Faruk Trade International, said high prices in the world market and high exchange rate of dollars have left an impact on date price.
Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue (CPD), said the people’s purchasing power fell due to inflation and it left a negative impact on the demand for food products. The same is applicable to the Ramadan commodities.
As imports are low, the authorities need to keep attention so that the supply is not disrupted anywhere. Also, the monitoring activities should be geared up to contain unwanted hikes in price,” he added.