Why Rice Prices Are Rising: Key Factors at Play

Rtv News

07 Sep 2024, 12:13

Photo: Collected

Government rice stocks are significantly lower compared to last year, and recent floods across 11 districts have severely impacted Aman and Aush paddy crops. Additionally, global rice prices are higher than domestic ones, making imports less viable. These factors are contributing to potential instability in the rice market, which may persist until October. However, relief is expected with the November harvest, according to the USDA’s latest quarterly report on Bangladesh’s grain and feed sector.

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The report, titled Bangladesh Grain and Feed Update, August 2024, also noted that while anti-discrimination student movements in July did not impact rice production directly, the month-long disruption to transportation due to road chaos and internet shutdowns significantly affected the rice market.

Government rice stock (as of September 4, 2024): 1.48 million tons (enough for 3 months).
Rice production forecast (2024): 36.8 million tons, which is 3% lower than the target due to flood damage in Chittagong, Barisal, and Sylhet.
Cultivated land for rice: 1.15 million hectares, down by 3.5% from last year.
Annual rice demand: Over 37 million tons.
Flood-affected districts: 11 districts, severely impacting Aman and Aush rice crops.

The USDA projects a 3% reduction in rice production this year due to floods in Chittagong, Barisal, and Sylhet, with total production estimated at 36.8 million tons. Paddy was cultivated on 1.15 million hectares, 3.5% less than last year, against an annual demand of over 37 million tons.

As of September 4, 2024, government warehouses hold 1.48 million tons of rice, enough to meet demand for the next three months. However, the report highlighted a lack of data on private rice stocks, suggesting a slight market shortage and ongoing instability for the next two months before normalcy returns.

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