Can farmers be protected from the curse of bumper harvest?

Shahadat Hussain, a farmer from Belabo, Narsingdi, grew cauliflower on his 20-decimal land. He sold the produce for Tk8,000, suffering a Tk4,000 loss. He had spent Tk12,000 for growing the crop. 

This was not the case last year; cauliflowers sold for a good price. Though Shahadat did not grow it then, encouraged by the returns for others last year, he decided to grow the crop this year, like many others.

In Belabo alone, cauliflower was grown on 15 hectares of additional land this year. On top of that, there was no rain in the last few months in the area, leading to a very good yield of the crop.

This was pretty much the case all around the country.

As a result, the price of the crop fell, bringing relief to the inflation-stricken ordinary consumers. But for farmers like Shahadat Hussein, it was a disaster.

"I sold each piece of cauliflower, weighing 2 to 3 kg, for Tk3," Shahadat said. For farmers from other parts of the country, especially in the north, the situation was no better. Many of them sold the crop for 50 paisa to Tk1 per kg. 

Many did not even bother harvesting it, sensing a huge loss, and chose to feed it to cattle instead. One farmer from Natore said that even cattle farmers were not interested in buying cauliflower.

This phenomenon of falling price of crops during a season of bumper harvest is nothing new; it has been going on forever. Some years it is potato, other times it is another crop.

Although people living in Dhaka almost always tend to buy agricultural products for higher prices for a number of reasons, the prices of such overproduced crops sell at a much lower price in the rural kitchen markets.

For example, while cauliflower is currently being sold in Dhaka markets at Tk25-Tk40, depending on the size, in Belabo, it is sold for Tk5 to Tk10 per piece in the bazar. In Bhairab, a neighbouring upazila of Kishoreganj, cauliflower is sold for at least Tk10 per piece.

Transport costs and the profits of middlemen and retailers make up the difference in prices between the farm and the city's kitchen market.

From Baroicha Bazar in Belabo to Dhaka, a truck carrying 2,000-3,000 pieces of cauliflower usually charges Tk5,000-6,000 to transport the load. This means for a piece of cauliflower sold for Tk3 at the farm, the transport cost is Tk3. For distant northern districts, the cost of transporting cauliflower worth Tk1 exceeds Tk5. Labour costs for loading and unloading the trucks are also high, adding to the final price of the produce.

While transport costs, middlemen and in some extreme cases syndicates play a role in food inflation — and there have been plenty of discussions on how to control them, without much effect — the problem of seasonal overproduction seems to gain little to no attention in a country dependent on food imports and limited purchase capacity of consumers.

The Department of Agriculture Extension takes various measures to promote the cultivation of certain crops and varieties. Such measures include free distribution of seeds and advice. It also determines the target for production of crops every season. However, when it comes to the possibility or fear of overproduction, the department remains inactive.

"Last year, cauliflower was grown on 71 hectares of land. This year, it was 86 hectares. Only in one upazila, the cultivation has increased on 15 hectare land. Riding on the good weather, the yield has been very good," said Muhibur Rahman Siddiqui, Upazila Agriculture Officer of Belabo, Narsingdi district. 

He said the department, with the help of upazila administration, monitored the markets and ran mobile courts to control prices.

On how to protect the farmers from extreme low prices, the agriculture officer said that some farmers are replanting cauliflower, for the third time in the season.

"The early growers [who started in September] got a good price [Tk 40 per piece], the late growers will also get some profit. This way, farmers think they will make up for the losses they are incurring at this moment," Muhibur Rahman said.

Asked if the department could stop over production, the official said the farmers grow crops based on their price assumptions.

Ekushey Padak winning agricultural economist Dr Jahangir Alam Khan told The Business Standard that there are a number of measures that should be taken to protect the farmers from losses. He said, in special cases, eliminating the intermediaries can help farmers get a fair price.

"Facilitating 'farmers' markets' in big cities where farmers will directly bring their products in truckloads will be helpful. A farmer needs to sell a cauliflower for Tk15, and if it is sold in the retail market at Tk20, I'll call it a fair price," he said. He added that the government should create facilities for such markets, and farmers or the Department of Agricultural Marketing themselves should bring the produce.

Mentioning that the agriculture marketing department should play an active role in this, Dr Jahangir Alam Khan said, "Agriculture is not a white collar job, and it cannot be done sitting in air conditioned rooms. They have to work closely with farmers, they must intervene."

The agricultural economist mentioned that in Kamarer Char in Sherpur, brinjal is grown in huge quantities, and is sold at Tk10 to Tk15 per kg by the farmers. But at the kitchen market, it is sold at Tk 40-50. "This huge margin wouldn't be there if farmers' cooperatives marketed the brinjal directly to the retailers in city marketplaces with the help of the government. And the profit would go directly to the farmers' pocket," he stated.

Dr Khan also emphasised the need for constructing cold storages to preserve perishable agricultural products.

The Director General of the Department of Agriculture Marketing Md Masud Karim also told media earlier this month that Bangladesh is self-sufficient in onion production. It is only because there is no storage system that onions have to be imported.

Meanwhile, potato farmers are already facing losses as the prices of advance-season potatoes have fallen. 

"When the crop is harvested in huge quantities, prices fall. If the crop can be preserved in cold storages for a month or two, the price situation will become normal and the farmers will get a fair price," said Dr Khan, also a former member director of the Bangladesh Agricultural Research Council, adding that we do not have enough cold storages in the country.

Production planning and price signalling can also be helpful to some extent, he said. Agriculture extension officials can convey messages to the farmers about a potential overproduction, but he added that farmers may not always listen to the advice due to witnessing a high price in the previous crop season.