Once an exporter, Bangladesh now allows potato imports as prices skyrocket
Meanwhile, the onion market has also been heating up as the prices rose by Tk40-Tk50 in the last three days in the local market due to the news of increase in the export price in India
Despite Bangladesh being a major potato exporter, the government has decided to import it for the first time to stabilise the domestic market, where prices have been rising sharply in recent weeks.
The commerce ministry issued a notification on Monday calling on interested importers to apply.
Meanwhile, the onion market has also been heating up as the prices rose by Tk40-Tk50 in the last three days in the local market due to the news of increase in the export price in India.
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Potatoes are currently selling for Tk60 per kg in Dhaka markets, and up to Tk70 per kg in Chattogram. The price of potatoes has increased 32.18% in the past month, according to market analysis data from the Trading Corporation of Bangladesh. The current price is 109.09% higher than what it was during the same time last year.
On the other hand, a visit to the Dhaka markets showed that local onions are selling for Tk130-Tk140 per kg, up from Tk90 just three days ago. Imported onions are now selling for Tk110-Tk120 per kg, up from Tk70-Tk80.
Stakeholders say potato prices are currently at record highs, with the trend starting in July. The Directorate of National Consumer Rights Protection, Ministry of Commerce, Bangladesh Cold Storage Association, and traders have held multiple meetings to control the situation. After that the Ministry of Commerce set the maximum retail price of potato at Tk35-Tk36 per kg. Despite all the efforts, prices have continued to rise.
The Directorate of National Consumer Rights Protection recommended importing potatoes in early October. The commerce ministry, however, did not grant permission for potato imports. The government has now allowed imports at a time when the early potato harvest in the northern part of the country is due to begin in a couple of weeks.
However, the Cold Storage Association has said since July potato production in the country has decreased and will be no more than 85 lakh tonnes. In contrast, the Bangladesh Bureau of Statistics claims that potato production in FY 2022-23 was 1.04 crore tonnes, and the Department of Agriculture Extension claims it was 1.12 crore tonnes.
The Department of Agricultural Marketing estimates that the country's annual demand for potatoes is 90 lakh tonnes.
Mostafa Azad Chowdhury, president of the Cold Storage Association, told The Business Standard that the government was informed in July that potato production had decreased, but no action was taken accordingly, leading to the current market crisis.
He said that Bangladesh has been an exporter of potatoes for a long time, but now has to import them, and that India is the only source of fast potato imports.
Bangladesh has regularly exported potatoes to several countries, including Saudi Arabia, Dubai, Myanmar, the Philippines, Nepal, Singapore, Malaysia, and Sri Lanka. However, potato exports in FY 2022-23 stood at only 28,570 tonnes, compared to 80,440 tonnes in the previous fiscal year.
According to the Department of Agricultural Marketing, the production cost of one kg of potatoes this year is Tk10.5, and the maximum retail price should not exceed Tk32.
According to sources, potatoes are currently selling for 20 rupees per kg in India. If imported, potatoes could be sold in the Bangladesh market at a maximum of Tk30-Tk35 per kg.
Traders are concerned that the import of potatoes may be like the import of eggs, where 15 crore eggs have been allowed to be imported in three phases since 18 September, but none have arrived in the country for almost one and a half months.
Mostafa Azad Chowdhury said, "Potato imports should be done quickly and monitored closely to avoid the same situation as eggs."
Onion market heating up
Since India fixed the minimum export price of onions at $800 per tonne, the price of onions has been rising in Bangladesh. However, traders claim that new export price onions have not yet been imported into the country.
The government fixed the maximum retail price of local onions at Tk65 on 14 September.
According to sources, the annual demand for onions in Bangladesh is about 28 lakh tonnes, while local production is more than 35 lakh tonnes, but there is a 25% post-harvest loss.
According to the Trading Corporation of Bangladesh, the price of local onions increased by 44.12% and that of imported onions by 64.29% in one month.
Balay Kumar Poddar, a consumer goods trader at Chattogram's Khatunganj, said that Indian onions are now selling for Tk100-110 per kg and domestic onions for Tk120-125 per kg, up from Tk80-Tk90 per kg three days ago.
M Harun Ur Rashid, president of the Hili Land Port Import-Export Association, said that no new price onions have arrived in the country yet. The onions currently being imported are under old LCs at a price of 50 Indian rupees per kg.
He said it will take another two-three days for the new LC onions to arrive, and that the price may then exceed Tk100 per kg including port charges.
He also demanded that importers be given the opportunity to open sufficient LCs, as the current import of 50-60 tonnes per day is not enough to meet the demand of more than 200 trucks per day
