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Bangladesh’s wheat import fell to its lowest in six years as many consumers switched to rice irked by surging prices of the grain.
Public and private importers brought in 40 lakh tonnes in fiscal year 2021-22, down 25 per cent year-on-year as businesses drastically cut imports, according to food ministry data.
Of the import in fiscal year 2021-22, the amount of wheat bought in by the government from abroad through tenders increased 19 per cent year-on-year to 5.46 lakh tonnes.
Private imports dipped 29 per cent to 34.6 lakh tonnes in fiscal year 2020-21.
“Many consumers have switched to rice because of exorbitant prices of wheat flour. Besides, demand for wheat among bakers is declining,” said Abul Bashar Chowdhury, chairman of BSM Group
This is the second consecutive year that wheat imports declined since total arrivals hit the highest 64 lakh tonnes to feed growing demand from the biscuit and bakery industry and changing food habits of people.
“Many price-sensitive consumers have switched to rice because of exorbitant prices of wheat flour. Besides, demand for wheat among bakers is declining,” said Abul Bashar Chowdhury, chairman of BSM Group, a major commodity importer based in Chattogram.
Bangladesh’s annual consumption of wheat stood at over 75 lakh tonnes a couple of years ago and most of the demand for the grain was met through import as local harvests provide roughly 10 lakh tonnes annually.
However, declining imports for the last two years reflect a drop in consumption as prices gradually rose since July 2020 when one kilogramme of wheat flour was Tk 25.5 at retail in Dhaka, according to data compiled by the Food and Agriculture Organization (FAO).
In June, the retail price of wheat flour was Tk 41.14 a kilogramme in Dhaka, the highest in 14 years, driven by surging import costs for high prices of the grain in the international market and continued weakening of the Bangladesh taka against the US dollar.
For example, prices of the wheat called US hard red winter (HRW) declined to $459.6 per tonne in June from $522.3 a month ago in the global market.
Prices of the wheat called US soft red winter also declined, according to World Bank Commodities Price Data (The Pink Sheet).
Chowdhury said the global wheat market had seen price decreases but the high cost of the US dollar for the devaluation of the taka had eroded the gain. “Our import cost has grown by 16-17 per cent because of depreciation,” he added.
Abdur Rob Sikder, owner of Sikder Flour Mills at Narayanganj, a major hub for wheat flour, said the war in Ukraine has adversely affected the global wheat market, resulting in an increase in prices here too.
India’s restriction on wheat export also affected the market, said Sikder, also cashier of flour mill owners’ association Narayanganj Ata Maida Mill Malik Samity.
Anup Kumar Saha, chief operating officer of Nabil Group, one of the major importers of wheat, said many letters of credit got cancelled after India banned export of the grain in May this year to cool rising domestic prices.
Besides, wheat from the Black Sea region did not come after the war in Ukraine began, he added.
He said because of increased prices, many people shifted to other cereals. As such, overall demand dropped to around 60 lakh tonnes during fiscal year 2021-22, added Saha.
(TDS)
