Lower import feared to cause short supply of Ramadan essentials

With Ramadan, just around the corner, importers and consumers alike fear that the prices of daily necessities may soar further in the month of fasting as the import of essential commodities has dwindled owing to the dollar crunch in the wake of the Russia–Ukraine war.    

The dollar crisis led the Bangladesh Bank to limit LC (Letter of Credit) margin and restrict imports of non-essential items as part of their belt-tightening measures. However, the import curb affected imports as a whole irrespective of the type of product.

Imports of essential Ramadan items like edible oil and dates have declined over 42-47% while the import of chickpeas, another major Ramadan item dropped by 56% from November to January of the current fiscal year 2022-23, compared to the same period of the previous fiscal year 2021-22.

The imports of soybean seed and peas have seen respectively 83% and 18% drop in that period, while the import of sugar remained around the same margin with only 2% decline.  

Most of the Ramadan essential commodities including chickpeas, pulse, dates, edible oil, sugar and flour are import dependent.

Traders said the price of consumer goods is already higher than last year due to reduced imports and they fear that with less import the prices of all types of products will increase in the retail market.

The price of chickpeas in Ramadan last year was around Tk70 per kg while it is now priced Tk90 to Tk95, which may exceed Tk100 per kg at the beginning of the Ramadan, they said.

Importers said unless the banks relax LC opening conditions immediately, it will not be possible to import sufficient products to meet the market demand before the Ramadan, which begins this March.

It takes one to one and a half months to import goods after LC opening, they pointed out.

Mizanur Rahman, deputy general manager of the Meghna Group, a major importer of consumer goods, told TBS that imports for the Ramadan season this year are less than last year.

"Since the imports of goods are less compared to the demand, the price of the daily Ramadan necessities will naturally be higher," said.

According to the Chattogram Custom House data, from November to January of FY 2022-23, 1,25,705 tonnes of soybean oil was imported. In the same period of the fiscal year, 2,23,384 tonnes of soybean was imported.

Similarly the soybean seed imports also decreased with only 1,05,898 tonnes imported compared to 6,23,717 tonnes in the same period last fiscal.  

About 4,04,704 tonnes of palm oil was imported against 284457 tonnes imported from November to January in FY22.

Import of chickpeas has also decreased by almost half – 43065 tonnes from 97944 tonnes. Import of peas was 1,16,876 tonnes from 1,42,212 tonnes.

However, sugar import was relatively normal – 6,82,293 tonnes in those three months from 6,97,153 tonnes in the same period the fiscal year before.

Some 22,000 tonnes of dates were imported through the Chattogram port in the last three months. It was 40,801 tonnes in the last fiscal.

Importers of consumer goods said importers used to compete with one another to ensure supply to the market. But this time around, the importers are unable to import products as per demand due LC restrictions caused by the dollar crunch.