Prices of essentials hiking ahead of Ramadan

Farhad Chowdhury : There are two more months left for Ramadan. Pricesof various commodities including rice, flour, flour, dal, gram, broiler, sugar, chira have started increasing at the wholesale and retail level. For this, in most cases, the businessmen are blaming the dollar crisis and the complexity of opening the loan. Although Bangladesh Bank has already taken steps to avoid the impact of these crises and complications in the market. The Foreign Exchange and Policy Department of the Central Bank has issued a notification yesterday, allowing the import of eight products on loan. The products are edible oil, chickpeas, pulses, peas, onions, spices, sugar and dates.
Those concerned say that every year, various preventive measures are taken in the market, including surveillance and raids by the administration. Keeping that possibility in mind, the traders are increasing the prices of the products a few months ago. In this situation, Bangladesh Bank has issued new instructions so that the market of products does not become unstable due to lack of timely import.
According to the notification, these products can be imported under 90 days suppliers or buyer’s credit. This facility will continue till March 31. Bank officials say, as a result of this opportunity, goods can be imported in the rest of the country. Now if the banks follow the proper procedure and open the import LC, the goods will arrive on time. This will ensure supply of necessary products on the occasion of Ramadan. But after some time, the pressure of payment of import duty will come.
Bangladesh Bank imposed 100% LC (letter of credit) margin on imports of luxury and non-essential goods in July 2022 to prevent depletion of foreign exchange reserves amid the dollar crisis. Essentially, import of these products is discouraged so that there is no shortage of dollars in the supply of essential products.
Despite this, it was not possible to prevent the dollar crisis or the loss of reserves. The import of essential goods has also been disrupted. According to the data of Bangladesh Bank, in the last fiscal year 2022-23, foodgrains worth $217 million were imported into the country. Whereas in the previous fiscal year, the import in this sector was $261 million. Out of this, rice import decreased from $546.2 million to $513.8 million. And wheat import decreased from $206.48 million to $165.78 million.
The downward trend of imports of the last fiscal year continues in the current fiscal year as well. In the first five months (July-November) of the fiscal year 2023-24, the country’s imports decreased by about 21 percent. Imports during the period under review stood at $25.72 billion, as against $32.54 billion in the same period of the previous fiscal year. Among them, LC opening of consumer goods decreased by 27.47 percent and LC settlement by 22 percent during July-November last year. In the first five months of FY 2023-24, consumer goods LCs were opened at $2.64 billion, as against $3.64 billion in the corresponding period of the previous fiscal. Similarly, LCs of consumer goods imports were settled at $276 million during the period, as against $355 million in the same period of the previous fiscal year.
Analysts say that despite the initiative to control imports, there is still a severe dollar shortage in the country. Along with this, the depletion of reserves also continues. Banks do not match dollars even at higher prices. As a result, even emergency goods cannot be imported as per demand. They have been forced to reduce imports, which has affected the stock of products in the market. Due to this, there is a tension between the demand, stock and potential supply of these products around Ramadan. In addition to this, there are also allegations that many people are taking advantage of the existing situation and increasing the prices of products at an abnormal rate.
A visit to different markets of the capital shows that in the last one week, various rice wholesale prices have increased by Tk 200-300 per sack (50 kg). Traders said that earlier, Bri-28 rice was sold at Tk 2,250 to Tk 2,350 per bag. Currently selling for Tk 2,550 to Tk2,700. Tk3 thousand to Tk3,050 miniket rice is being sold at Tk3,250 to Tk3,300. Swarna and Pajam rice prices have also increased by Tk 2-3 per kg.
The price of flour and flour increased during the week. According to the Trading Corporation of Bangladesh (TCB), packaged flour is selling at Tk 55-65, up Tk 5 per kg. Opened and packaged flour increased by Tk 5 per kg and is being sold at Tk 65-70 and Tk 70-75 respectively. Mugdal is being sold at Tk 100-160 per kg depending on the quality. Although a week ago it was sold at Tk 95-135. The price of gram has increased by Tk 10 per kg and is currently being sold at Tk 95-110. Small grain lentil is being sold at Tk 140 per kg increased by Tk 10.
Consumers Association of Bangladesh (CAB) Vice President SM Najer Hossain told, “Every year the prices start increasing a few months before Ramadan. During Ramadan, there is more supervision, because of this, the price is raised in advance and money is withdrawn from the market. This is happening again. On the one hand, the price of everything has increased due to the election. The price of rice has also been increased even though it is the peak season. For this reason, the supervision of Ramadan should be started from now.
Onion and garlic prices are also on the rise. At present, domestic onion is being sold at Tk 80-100 per kg, which was sold at Tk 80-90 last week. The price of domestic garlic has increased by Tk20 and is currently being sold at Tk220-260 depending on the quality. The price of imported ginger has increased by Tk 10 per kg and is being sold at Tk 200-260. The price of small cardamom has increased by about Tk 600 and is being sold at Tk 2200-TkTk3600 per kg. Meanwhile, the price of broiler chicken has increased by about Tk 20 per kg and is currently being sold at Tk 200-210 per kg.
Traders of caravan market in the capital Saiful Islam told, “The prices of all types of pulses are on the rise. Earlier I used to sell Mugdal for Tk140. Now the price per kg is Tk160. We have to buy at a higher price. Because of this, I am selling at a higher price.
Meanwhile in Khatunganj, the largest wholesale market of consumer goods in the country, prices of various daily commodities have started increasing. It has been found that the prices of gram, dal, chira, wheat and sugar increase the most before fasting. Among the edible oils, the price of palm oil has not increased, but the price of soybeans has increased. Due to low demand due to solidification of palm oil in winter, prices did not increase. However, they think that the price of this product may increase as fasting approaches.
According to market sources, currently soybeans are being sold at DO (delivery order) stage at Tk 6,300 per maund (37.32 kg) and at Tk 6,500 at collection stage from millgate. Palm oil was traded at Tk 5,000 per maund, Super Palm Oil at Tk 5,300 per maund at the ready or direct collection stage from the millgate. On the other hand, the price of wheat increased by Tk 100 to Tk 120 per maund to Tk 1,500 to Tk 1,700 (Russia), Canadian wheat is being traded at Tk 2,000. Along with the increase in the price of wheat in the last one week, the price of rice has also increased. The price of chira, one of the daily staples of Roja, has increased by Tk 100 to Tk 150 per bag (50 kg) in a span of two weeks. At present, each sack of chira is being traded at Tk 2,800 to Tk 3,500 depending on the quality. The businessmen said that mainly because the market of rice is on the rise, the market of chira has also increased.
Meanwhile, the price of sugar has increased by about Tk 300 per maund in the last two weeks. This daily product is currently being traded at Tk5 thousand per maund. The price of chickpea per kg has increased by up to Tk 5 in the last 7-10 days and is being traded at Tk 94 to Tk 105 per kg. In addition, double lentil increased by Tk 2 to Tk 62 per kg, coarse lentil (imported) increased by Tk 3 to Tk 4 to Tk 98 to Tk 100, domestic lentil increased by Tk 3-4 to Tk 140-150 per kg, gram dal increased by Tk 2-3 to Tk 100 per kg. It is between Tk95 and Tk100.
General Secretary of Khatunganj Trade and Industries Association Sayed Sagir Ahmed told, “The supply is low due to the multifaceted crisis in the country. Moreover, due to the increase in the value of the dollar, the reluctance of the banks to open loans, the products equivalent to the increased demand for fasting have not yet been imported. Because of which many businessmen now collect the goods a few months before fasting due to the fear of crisis. Which has an impact on the wholesale market. If there is sufficient stock in the market and there is no crisis in the supply chain, the products of Roja are being sold at normal prices this year as well. For this, he thinks that the cooperation of the government, administration and banks is necessary.
Director General of National Consumer Protection Directorate AHM Safikuzzaman told, “We have taken various initiatives to ensure that the supply of various products is normal according to the demand during Ramadan. The price of the product increases due to many reasons. However, we are monitoring to ensure that no one can create instability.