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Download PDF The public food distribution target for the current fiscal is very likely to be left unmet while the possibility is also very slim of building a 10 lakh tonne government food bank in the coming boro season.
A food ministry report says the government had a target of distributing 21.90 lakh tonnes of rice and wheat in the current fiscal through its various safety net programmes and open market sales amid high prices of food items on the market.
Till March it distributed 9.55 lakh tonnes of food grains while setting a target to distribute another 3.64 lakh tonnes in the remaining three months of the current fiscal, meaning the government will be able to distribute the highest of 13.19 lakh tonnes of food grains this fiscal compared to the total distribution of 14.62 lakh tonnes in the last one.
Food Adviser AMM Shawkat Ali at a news briefing last week said the government will distribute 2.68 lakh tonnes of food grains this month, and if needed the amount will be increased.
Programmes for public food distribution include vulnerable group feeding (VGF), vulnerable group development (VGD), open market sales (OMS), and fair price outlets.
“Distribution of food grains through government programmes has not been satisfactory this fiscal,” said a food ministry official adding that repeated floods, cyclone Sidr and price hike of foodstuff have given rise to the current food crisis in the country since the shortage of supply and high prices are making the essentials scarcer for the people, leaving their demand unmet.
Asked about lagging behind in meeting the public distribution target, the official said the government food stock is currently low, and pointed at the scarcity and high prices as the reasons for it.
A food ministry report placed before last week’s meeting of the advisory committee on government purchase, alarmed the government that it might not be possible to build up an adequate food bank and run the public distribution programme smoothly, if it fails to import five lakh tonnes of rice from India.
The report expresses doubts about meeting the government’s food grains procurement target, saying the possibility of meeting the government’s wheat procurement target in the current season is very slim as market prices are higher than what the government is willing to pay.
The government set the procurement price for a kilogramme (kg) of wheat at Tk 26 while the market price for it is no less than Tk 30.
About the government’s boro procurement target, the report says there are indications of a good boro harvest this season, but it is heavily depended upon the weather in the next few weeks.
Referring to the mismatch between the market price of wheat and the government’s procurement offer, a food ministry official told The Daily Star that procurement of boro will also depend on how much the government is willing to spend. Farmers might not sell rice to the government as prices on the market are higher while the demand for rice is also tremendous right now, he added.
Food ministry officials said the government is in a dilemma about fixing the procurement price for boro.
“If the government sets a high price, it will definitely affect the market hiking up prices of rice yet another time, and if we fix a lower price we will not be able to meet the procurement target,” said a senior food ministry official.
Meanwhile, scarcity and high prices of rice have been hampering the government target of building up a stable food stock of at least 10 lakh tonnes.
The official data show, till the end of March a total of 4.81 lakh tonnes of food grains were in government food bank, 3.22 lakh tonnes of which were rice and 1.58 lakh tonnes wheat.
In July last year the government food stock was at 6.86 lakh tonnes, according to the data.
The government could not achieve its rice procurement target as it offered a price lower than the market prices.
The other option for building up a stable food stock was through import, but import of rice was not satisfactory due to high prices and scarcity of it on the international market.
The government invited tenders for importing 9 lakh tonnes of rice and wheat, but failed to elicit adequate response from traders due to the scarcity and price hikes on the international market.
The government invited tenders for importing rice 36 times in the current fiscal till March. A food ministry official said response to the tenders was not good. “Some of the traders received work orders and signed deals with the government to supply, but finally they did not import due to price increase on the international market. Import cost of rice became higher than what had been quoted in the tender bids,” he said.
According to the Food Situation Report 2007 of the food ministry, the total food grains import requirement for the current fiscal is projected at 40.3 lakh tonnes, while in the last fiscal a total of 24.2 lakh tonnes of rice was imported. The government plans to import about 10 lakh tonnes of food grains this fiscal to recover from the shortfall in domestic procurement and to meet the increased demand for public distribution of food grains through safety net programmes.
In the last fiscal food grains import through government channels had been 2 lakh tonnes while till March of this fiscal it was 4.31 lakh tonnes.
The food ministry data show that the government has a target of procuring 12 lakh tonnes of rice and wheat from domestic sources in the current fiscal. In July to January period of this fiscal food grains procurement was 2.67 lakh tonnes which had been 6.86 lakh tonnes during the same period of the last fiscal.
Sources said the government failed to procure adequate amount of rice during the last aman season due to the low prices it had offered, although it had a target of procuring 2 lakh tonnes of aman.
Food Adviser AMM Shawkat Ali said the government has a target of procuring 10 lakh tonnes of boro this season.
Uttam Kumar Deb, a researcher at the Centre for Policy Dialogue (CPD), said the government should fix the procurement price for boro at Tk 27 a kg since the production cost ranges between Tk 18 and Tk 20. He said such a price would benefit producers and consumers both.
The CPD researcher suggested the government to form a special committee which would deal with import of rice and expedite the process.
“There are chances that prices of rice on the international market will fall slightly in the next few months, the government should make a special drive to buy rice then, involving the special committee,” he added.
Deb also asked the government to include potato in the public food distribution programmes to reduce pressure on rice.
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