Grain import sees ray again
Golam Mostafa Jibon: Traders have started to see a glimpse of relief in terms of import and export of foods due to recent agreement between Russia and Ukraine mediated by the United Nations.
The Russia-Ukraine war has had a major impact on Bangladesh’s import-export trade. The price of goods has increased by leaps and bounds for the last few months. People are gasping because they are completely out of affordability. However, due to an agreement between Russia and Ukraine mediated by the United Nations, traders are seeing a glimpse of relief in terms of import and export of foods and other goods.
Meanwhile, the process of importing 3 lakh tons of wheat from Russia is final. More wheat, maize, mustard and lentils are now in the process of being brought in from Russia and Ukraine soon. Russia attacked Ukraine on February 24 this year. After that, import and export from all Black Sea Ports were stopped. However, under the agreement reached last month, the first grain-carrying ship left Ukraine’s Odesa port on August 1. This is Ukraine’s first shipment of wheat. One-third of the world’s wheat demand is met from the two countries. Ukraine’s grain exports by sea have been suspended since the Russian attack.
According to sources in the Ministry of Food, the government has reached a policy decision to import 300,000 tons of wheat from Russia. For this purpose, Russia has held a meeting with the high-level representative of the government. A positive decision was taken on wheat import in the meeting. Apart from this, various issues including economic development of Bangladesh, expansion of bilateral trade and wheat export were discussed in the meeting.
According to the data of Import and Export Control Department, trade amount between Bangladesh and Russia is about 1100 million dollars every year. One-third of Bangladesh’s total wheat demand comes from Russia and Ukraine. About 80 percent of sunflower oil comes from the two countries. About 20 percent of Bangladesh’s total corn demand comes from Russia and Ukraine. Bangladesh currently imports 500,000 tons of diesel, 130,000 tons of crude oil, 200,000 ‘tons of furnace oil and 120,000 ‘tons of octane per year. Due to the war, the price of fuel oil rose up to 115 dollars per barrel in the world market.
According to related sources, cotton, wheat, corn, mustard, lentils are regularly imported to Bangladesh from Russia and Ukraine. Out of the maximum 7 million tons of wheat demand in the country, 3.5 million tons are coming from Russia and Ukraine. This wheat is processed to produce various by-products including flour, flour, semolina. Prices of goods imported from Russia and Ukraine have already increased. Due to the situation, the businessmen of both countries have been forced to suspend the import activities of goods to Bangladesh with Russia and Ukraine.
According to the data of the Export Development Bureau, in the fiscal year 2020-2021, Bangladesh exported goods worth $665.3 million to Russia, of which ready-made garments are the largest. Imported goods worth is $466.7 million, most of which are food products. In the previous year, Bangladesh exported goods worth $48.7 million to Russia, while imports were worth $78.2 million. In particular, one-third of wheat demand comes from Russia and Ukraine. About 20 percent of corn comes from these two countries. Russia is also being considered as a new market for export of manufactured garments. Businessmen of Bangladesh said that, the impact of the Ukraine-Russia crisis has already started falling on their business.
Faizur Rahman, managing director of the importing company Noapara Group said that, “Due to the ongoing war between Russia and Ukraine, there has been a big shock in the country’s import-export sector. The price of oil increased due to the war, which has an impact on the market. However, due to the agreement reached with the government on the import of wheat from Russia recently, there is a glimpse of relief. It will take more time to be completely normal.”
Wheat importer Shahin Reza, proprietor of SK Reza Enterprises said that, “Although the matter of wheat import has been discussed at the government level, the import process has not started yet. Even if the process of importing wheat from Russia or Ukraine has started, it will take one and a half to two months to reach the country. So it will take more time to have an impact on the country’s market.”
Regarding the import of wheat from Russia, Food Minister Sadhan Chandra Majumdar said, “Due to the complications of Bangladesh’s money exchange with Russia, there was a major obstacle in the import. Recently we have cleared the way for imports. Meanwhile, the negotiation of importing 300,000 tons of wheat from Russia has been finalized. Now the process of importing maize, mustard and lentils along with wheat is going on.”
The food minister also expressed hope that if this trend continues, the upward trend of the current market will decrease somewhat.
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