Rice market needs monitoring to keep prices in control

A stitch in time saves nine. Instability prevails in the rice market as timely steps were not taken to keep things in control. The first mistake of the government was not being able to meet the target of paddy and rice collection despite good yield of the boro rice crop. The second mistake was not to have accurate data on how much rice lies with the farmers, wholesalers, and the rice mills. The government has been advancing rather blindly in this regard.

A meeting between food minister Sadhan Chandra Majumder and rice mill owners on Tuesday set the mill gate prices of rice. According to the new price, miniket rice will be sold at Tk 51.50 per kg and 50kg sack of rice at Tk 2,575. Medium quality rice will have to be sold at Tk 45 per kg and 50kg sack at Tk 2,250. Earlier, the millers used to sell the rice at a higher price than this.

In a free market economy, there are doubts as to whether the rice market can be kept stable by fixing prices this way. The meeting also decided that the millers across the country would have to sell rice at the fixed prices from Wednesday. The news received from various places is not promising. Rice was not sold at the government fixed prices at all the mills. Sales and supply were much less at the mills where rice was sold at fixed rates. According to the millers, it is not possible to supply the grain at the fixed price as they are buying it at higher prices from the farmers and wholesalers. They say if they can buy paddy at a lower price, they will also be able to supply rice at a lower rate.

According to Prothom Alo, an average of 150 trucks daily delivers rice from Khwazanagar of Kushtia, the second-largest rice hub of the country. But only 50 trucks delivered rice on Thursday. If the supply of rice is low from mill, the market may become more unsteady.

The decision to sell rice at the fixed rate did not have any impact on the market. According to the Trading Corporation of Bangladesh (TCB), fine rice was sold at Tk 52 to 60 per kg while medium quality rice was sold at Tk 45 to 50 per kg in the capital. The traders sold coarse rice at Tk 42 to 48. The price of coarse rice increased by 6 per cent over the last one month. The prices of fine and medium quality rice are also on the rise.

Though the boro rice harvest was good this year, aman rice was damaged due to floods and cyclone Amphan. Aman rice would be harvested in November. The government must increase the sale of rice in the open market in order to keep the market stable till that time. Rice can be imported from abroad if necessary. This will be more effective to control the market rather than any advice or price fixing. Corona has reduced the income of the common people. On top of this, the increase of rice prices has put additional pressure on them.

The food minister has said that he would not tolerate any manipulation over rice. Whether the rice market will be stable or not depends on how far the concerned persons and institutions heed his warning. The millers and wholesalers are blaming each other for the rise in rice prices. It is the responsibility of the government to determine the actual culprits and to address the instability in the market. This requires continuous supervision.