Bangladesh - Food Security Bulletin: No. 8, January - March 2012
The countrywide retail price of rice has declined from last quarter by 4 percent and from the same quarter of the previous year by 17 percent. There has been a 6 percent and 4 percent increase in the price of whole-grain wheat flour (atta) and palm oil respectively compared to the last quarter. The retail price of lentil has declined in the current quarter compared to both last quarter and last year. When compared to the high food prices of 2008, the retail prices of all essential food commodities except edible oil have decreased.
The general inflation rate and food inflation, measured by the point to point variation in the Consumer Price Index (CPI), was highest in January, however came down in the following months. The inflation hike was attributed to soaring prices of power and fuel as well as the devaluation of the Taka. Inflation in non-food sectors reached a record high in March at 13.96 percent. Urban food inflation was 10.8 percent while rural inflation was 7.2 percent - the highest difference in food inflation between urban and rural areas since August 2011.
The remittance inflow reached a record high in January with the country receiving USD 1.221 billion (in current terms), bolstered by the depreciation of the Taka. As the Taka began regaining against the USD since February, remittance inflow started to decease.
Aus production as estimated by the Bangladesh Bureau of Statistics (BBS) is 2.3 million MT which is 16.7 percent less than the target. Aman production remained stagnant mainly because of expected low farmgate prices for the produce. BBS’s latest estimate of Aman production in the FY 2011/12 was 12.8 million MT, which is less than the Department of Agriculture Extension’s (DAE) target of 13.3 million MT.
In order to retain last year's total food grain output, Boro production should grow by at least 6 percent, which is unlikely to happen as agricultural input costs have increased manifold.
According to the government’s Food Division, as of 15 April 349,000 MT of Aman rice were procured. As of 22 April 2012, the public stock stood at 1.2 million MT. In March the government had to further revise its previous wheat import target upward due to a declining import trend by the private channels.
In January which is a season of agricultural employment, a male agricultural wage labourer could buy 8.7 kg of rice with his daily income of 254 Taka, an increase of 39 percent from the purchasing capacity a year ago. The decline in rice price and increase in daily wage in January contributed to this increase in rice purchasing capacity of the agricultural day labourers which usually starts falling from midFebruary. An estimation of monthly ToT in Khulna division reported 32 percent decline in purchasing capacity from harvest (January) to lean season (March).
Sylhet division reported to have worst ToT mainly due to higher price of rice and lower wage rate.
In January, the national average wage for a female agricultural labourer was only 198 Taka/day- leading to 6.6 kg/day in rice purchasing capacity, significantly less than of a male labourer. In addition work opportunities for female agricultural labourers are far less than for their male counterparts. While a male labourer can find work on average for 20 days per month, female labourers can find work on average for only 10 days per month. FGDs conducted in urban slum households found that nominal income of the urban poor has increased slightly compared to the same time last year and overall, the rice purchasing capacity of the urban poor is higher than the rural poor.
FAO’s estimate for world cereal production in 2011 has been revised upward to 2.3 billion MT, 4 percent above the previous year’s crop production and a new high.
World cereal consumption in 2011/12 is forecast to increase by over 2 percent. The global cereal price index remained stable as compared to last quarter, yet decreased by 10 percent compared to the same quarter last year. This is due to the decline in international prices of maize and wheat, while rice price increased.