The government is taking time to go for procurement of Boro rice to build a public stock as it considers market price of rice is still high, and public purchase of it for providing price incentives to farmers is not needed at this stage.
In the previous years, procurement of Boro rice for government stock used to start in mid or late April.
But this year the food ministry has not yet announced a procurement policy while Boro harvest is already more than halfway through, and will be over by the first week of next month.
Some experts support the government strategy, but others oppose it saying small and marginal farmers, who are forced to sell their produce during peak season to repay their loans for Boro cultivation, will face losses or make marginal gains that will discourage them to grow rice.
"Rice price is still high, though it started declining. Paddy price is not yet at a level that farmers will face losses. If we see farmers are really deprived of fair prices, we shall surely procure rice," said Agriculture Minister Matia Chowdhury.
Coarse rice prices in the capital's markets now range from Tk 30 to 34 a kg, that of medium quality rice from Tk 35 to 40 and of fine rice from Tk 41 to 50. The prices have fallen 6-7 percent in the last one month, but still these are 14-20 percent higher than during the corresponding period last year.
Food ministry officials said prices of coarse rice in the rural markets are also not less than Tk 28 a kg. Paddy prices are between Tk 525 and Tk 750 a maund depending on varieties compared to Tk 750-1100 in March, according to farmers and rice millers.
Matia Chowdhury, who is also on the Food Policy Monitoring Committee, said, "Throughout last year, farmers made good gains. At the present prices too, they are making gains."
The Department of Agriculture Extension (DAE) assessed production cost of milled boro rice this year is Tk 24-25 a kg, she mentioned.
The agriculture minister said that fixing rice procurement price at Tk 27-28 will be fine, but market price of coarse rice is still higher than this. A prime goal of public food procurement is price support for farmers, but as the price is still high, the government is waiting for it to decline, she added.
Ahmad Hossain Khan, director general of food directorate, said, "Rice price could go up if we start procurement immediately."
Prices would come down further when harvest is over 80 percent, mainly in the major Boro producing districts in the northern region of the country.
Dr Quazi Shahabuddin, former director general of Bangladesh Institute of Development Studies, supported the government strategy, but suggested that it must keep a watch on food prices both in the domestic and global markets.
"If prices in the international market are lower than those in the domestic market, the government will surely go for import."
Former food secretary Abdul Latif Mondal however said the government has to go for rice procurement immediately to ensure interests of small and marginal farmers, if not of the big farmers.
"Small farmers sell paddy immediately after the harvest to pay the loans they take for cultivation. Low prices of paddy means losses for them," he said. "If these farmers make more gains, they will grow more, which is crucial to food security."
Mondal warned that rice traders, who take large amounts of bank loans, are controlling the rice market now, and will continue to do so if the government further delays rice procurement.
Referring to last Boro season, he said the government managed to buy less than six lakh tonnes of rice while the target was 12 lakh tonnes. Later, under pressure from rice millers, it had to increase procurement price to Tk 28 a kg from Tk 25.
"We must take lessons from the past. Higher prices should go to the farmers, not to the rice millers," he said.
Source: The Daily Star (May 22, 2011)
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