State of the Bangladesh Economy in FY2021-22
Independent Review of
RBD
Bangladesh's Development
2.1 Changes in prices in the Supply Chain of
Rice: Farmgate, Wholesale and Retail Markets
Distribution of margin in the supply chain:
The margin received by agents working at farmgate level, including those by the rice millers, is
higher in case of fine rice (e.g. fine aman and fine boro) than is the case for coarse rice (e.g.
coarse aman and coarse boro).
The margin level was very high in early and mid-2020s compared to that in late 2020s.
☐ However, the margin received by agents working in wholesale and retail markets fluctuated, at
moderated level, though their margin was higher in the case of fine rice.
☐ Fluctuation of margin is rather high at rice millers' end compared to that at wholesalers' and
retailers' end.
In other words, some market agents, particularly rice millers, are likely to play the role as
'dominant market agents' and influencing the market price and receiving higher margins.
Public Food Stock, PFDS and Their Impact on Rice Price:
□ Rice market price is found to be influenced by the level of availability of public food stock,
particularly rice.
➤ During 2021 (as of September, 2021) the average stock was lower at 944 m tons however, the
stock situation has improved in the last three months due to higher procurement and import.
➤ Higher food stock has helped to stabilize the market price in recent months though it has yet
to have any positive impact on market price.
➤ This is perhaps because of a lack of consistent and available supply of bulk scale rice stock in
public warehouses which could transmit a positive market signal.
CPD (2021): State of the Bangladesh Economy in FY2021-22 (First Reading)
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