Report Highlights:

For marketing year (MY) 2015/16 (May to April), Post's estimate for total rice area and production is unchanged at 11.8 million hectares and 34.8 million tons. For MY 2014/15, the rice import estimate increased to 1.2 million tons, a record, on revised customs data. For MY 2015/16 (July to June), Post's wheat import forecast is lowered to 3.6 million tons due to large stocks and domestic supplies.

Executive Summary:

For marketing year (MY) 2015/16 (May to April), Post's estimate for total rice area and production is unchanged at 11.8 million hectares and 34.8 million tons. Post's MY 2015/16 (July to June) wheat production forecast is revised slightly to 1.32 million tons assuming normal weather conditions. The MY 2015/16 rice import forecast is unchanged at 600,000 tons; high domestic supplies are expected to mitigate import demand. For MY 2014/15, the rice import estimate increased to 1.2 million tons, a record, on revised customs data. For MY 2015/16, Post's wheat import forecast is lowered to 3.6 million tons due to large stocks and domestic supplies.

Rice and Wheat Production

For marketing year (MY) 2015/16 (May to April), Post's estimate for total rice area and production is unchanged at 11.8 million hectares and 34.8 million tons. Assuming a normal monsoon, Aman rice seedling production should progress on schedule. For more information on rice growing seasons (Boro, Aman, and Aus).

On March 3, 2015, the Bangladesh Ministry of Food (MOF) set a procurement price for milled and paddy (unmilled) Boro rice at BDT 32 ($0.41) and BDT 22 ($0.28) per kilogram. According to media articles, even with higher procurement prices than last year, farmers allegedly have had difficulty selling their Boro rice crop at the procurement price. High imports of relatively less expensive rice coupled with strong domestic production may have caused overall domestic rice supplies to increase, exceeding local demand and resulting in lower market prices. From May 1, 2015 to August 31, 2015, reportedly the Government of Bangladesh (GOB) is planning to procure one millions tons of Boro milled rice and 100,000 tons of Boro paddy rice.

Post's MY 2015/16 (July to June) wheat production forecast is revised slightly to 1.32 million tons assuming normal weather conditions. From April to June 2015, the GOB set a domestic procurement price for wheat at BDT 28 ($0.35) per kilogram.

Rice and Wheat Market Prices

For July 2015, the wholesale and retail prices for rice in Dhaka and Gazipur were BDT 28 ($0.36) and BDT 31 ($0.40) per kilogram, respectively, which were 11.5 percent and 7.5 percent less than last year . For the same month, the average retail price of wheat flour (also called atta) in Dhaka was estimated at BDT 29 ($0.37) per kilogram, which was about 9 percent less than last year, and 6.5 percent less than current rice retail prices. For MY 2015/16, the July WASDE predicts global wheat production will be the second largest on record; major wheat exporters also are expected to have large exportable supplies, which may help depress prices. Because wheat imports constitute approximately 70 percent of total Bangladeshi consumption, less expensive imported wheat may cause some consumers to purchase more wheat flour than rice if domestic rice prices are less competitive.

Rice and Wheat Imports

The MY 2015/16 rice import forecast is unchanged at 600,000 tons; high domestic supplies are expected to mitigate import demand. The 10 percent duty on rice imports also may ease demand for imports from India and Thailand. For MY 2014/15, the rice import estimate increased to 1.2 million tons, a record, on revised customs data. For MY 2015/16, Post's wheat import forecast is lowered to 3.6 million tons due to large stocks and domestic supplies. Post's MY 2014/15 wheat import estimate is revised up to 3.8 million tons on competitive prices and import pace.

Rice and Wheat Stocks

According to the MOF, in comparison to last year, in July 21, 2015 government rice stocks rose from 891,000 to 1.09 million tons. For the same period, government wheat stocks fell to 288,770 tons.

Policy

On May 10, 2015, the GOB imposed a 10 percent duty on rice imports, which allegedly was to curb less expensive Indian rice imports that generally constitute the largest proportion of the import market. In fiscal year (FY) 2014/15 (July to June), according to the MOF, Bangladesh procured 942,932 tons and 204,896 tons of rice and wheat from the domestic market. According to official contacts, Bangladesh is planning to continue to allow aromatic/fragrant rice exports with permission from the Ministry of Commerce. Exports of non-fragrant rice are still not allowed, although exceptions can be made by the GOB such as the recent government-to-government agreement to export rice to Sri Lanka.

Rice, Milled, PSD

(Area in Thousand Hectares, Quantity in Thousand Metric Tons)

Rice, Milled

2013/2014

2014/2015

2015/2016

Market Begin Year

May 2013

May 2014

May 2015

Bangladesh

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

11750

11750

11800

11790

12000

11810

Beginning Stocks

696

696

937

937

1212

1435

Milled Production

34390

34390

34500

34500

35000

34800

Rough Production

51590

51590

51755

51755

52505

52205

Milling Rate (.9999)

6666

6666

6666

6666

6666

6666

MY Imports

751

751

1100

1223

600

600

TY Imports

1290

1323

700

600

850

850

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

35837

35837

36537

36660

36812

36835

MY Exports

0

0

25

25

0

0

TY Exports

0

0

25

25

0

0

Consumption and Residual

34900

34900

35300

35200

35600

35500

Ending Stocks

937

937

1212

1435

1212

1335

Total Distribution

35837

35837

36537

36660

36812

36835

Wheat, PSD

(Area in Thousand Hectares, Quantity in Thousand Metric Tons)

Wheat

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

Bangladesh

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

410

410

415

415

415

420

Beginning Stocks

1104

1104

1338

1313

1538

1613

Production

1280

1280

1300

1300

1300

1320

MY Imports

3354

3329

3800

3800

3800

3600

TY Imports

3354

3329

3800

3800

3800

3600

TY Imp. from U.S.

86

0

0

0

0

0

Total Supply

5738

5713

6438

6413

6638

6533

MY Exports

0

0

0

0

0

0

TY Exports

0

0

0

0

0

0

Feed and Residual

0

0

0

0

0

0

FSI Consumption

4400

4400

4900

4800

5200

5300

Total Consumption

4400

4400

4900

4800

5200

5300

Ending Stocks

1338

1313

1538

1613

1438

1233

Total Distribution

5738

5713

6438

6413

6638

6533