Highlights

For marketing year (MY) 2016/17 (May to April), Post's rice production estimate remains flat at 34.5 million tons due to flooding that affected Aus rice production in northern, northeastern and central parts of Bangladesh. Estimated production is lowered only marginally,ф however, since Aus rice constitutes just 6.78% of total rice production. For MY 2016/17, Post's wheat import forecast is raised to 4.7 million MT because new bakery products are expected to drive higher consumption. Based on customs data, Post's MY 2015/16 wheat import estimate is revised to 4.49 million MT.

Rice and Wheat Production

For MY 2016/17, Post's estimate for total rice area and production is lowered to 11.68 million hectares (HA) and 34.5 million tons due to Aus rice production lost to flooding. Aus rice planted area is estimated to be lower at 1.1 million HA and production is lowered to 2.34 MMT. The impact on total rice area and production, however, is minimal since Aus rice constitutes only 9.4% of total area and 6.78% of total rice production.

Post contacts note that flooding during monsoon season affected not only the Aus rice harvest, but also Aman rice seedbed, vegeReports, jute, sugarcane, maize, groundnut, banana, betel leaf, and other minor crops and fruits. Several districts in the northern, northeastern and central areas were partially affected by flooding from mid-July to mid-August, 2016. The Ministry of Agriculture reported 0.75 million HA of submerged cropland and damaged standing cropland of 1.6 million HA. Farmers managed to recover the Aman rice crop through replanting late in the season, but Aus rice affected by flooding was destroyed.

Government of Bangladesh is supporting farmers by spending BDT 421 million ($5.32 million) in an agriculture rehabilitation and incentive program for the Kharif-2 (autumn) and Robi (winter) season. To make up for crop losses and to boost production, the government distributed rice seed, rice seedlings, and fertilizer to 0.75 million lower-income farmers. Both broadcast and transplanted Aman planting are complete and harvesting will start in November. Official sources and other contacts believe that continued good weather will result in a good Aman rice harvest.

Post's MY 2016/17 (July to June) wheat production forecast is unchanged. Wheat (planted mid-November and harvested in March) is a competing crop with Boro rice, maize and potato. Farmers prefer to produce maize and potato in some locations to take advantage of the availability of water and cool temperatures in the winter season.

Rice and Wheat Market Prices

For September 2016, the wholesale and retail prices for coarse rice in Dhaka and Gazipur were BDT 32.44 ($0.41), and BDT 34.67 ($0.44) per kilogram, respectively. These prices were 17.45 percent and 10.66 percent higher than prices at the same time last year . For the same month, the wholesale and retail prices of wheat flour (also called atta) were estimated at BDT 21 ($0.27) and BDT 24 ($0.3) per kilogram. Wheat flour is approximately BDT 13.66 less expensive per kilo than rice at the retail level, which for some consumers is enough to influence buying decisions. Rice prices have soared in the last few months due to local market supply contraction in response to rice procurement by the government at price BDT 32 ($0.44) per kilogram.

Rice and Wheat Imports

The MY 2016/17 rice import forecast is unchanged at 0.15 MMT tons, which is lower than MY 2015/16 imports on the higher import tariff rate at 25%. For MY 2016/17, Post's wheat import forecast is raised to 4.7 million MT as driven by development and expansion of new products in the bakery industry.

Post's MY 2015/16 wheat import estimate is revised to 4.482 million tons using customs data.

According to the Ministry of Food, from July to September 29, 2016, rice imports totaled 2460 MT and wheat imports 1.2 million MT, which was 96% lower (rice) and 77% higher (wheat) than the same period of last year. For MY 2015/16, Post estimated rice exports were 4,361 MT, which was primarily of fragrant rice.

Rice and Wheat Stocks

According to the Ministry of Food, on September 29, 2016 government rice stocks were 0.75 million MT, compared to 1.25 million MT at the same time last year. For the same date, government wheat stocks were 287,370 MT, down from 327,350 MT at the same time last year. Post's rice stock forecast for MY 2016/17 is lower than MY 2015/16; lower imports are expected in response to increased tariffs. Additionally, no official data is available on private stocks, which include stocks held by farmers, millers, and traders.

Policy

Government of Bangladesh introduced a new policy to create a social safety net called “Friendly Food Program", which involves selling rice at BDT 10 ($ 0.13) per kilogram. Beginning September 7 the Ministry of Food is selling rice to registered impoverished families for the months of September, October, November, March and April. The new policy is to sell 30 kg of rice per month to five million poor households, with priority given to woman-led families, and poor families having autistic children. The GOB planned to sell 0.75 million MT rice with subsidy of BDT 27 ($0.34) per kilogram, a total value of about BDT 215 billion ($2.7 billion).

Rice, Milled

2014/2015

2015/2016

2016/2017

Market Begin Year

May 2014

May 2015

May 2016

Bangladesh

USDA

New

USDA

New

USDA

New

Official

Post

Official

Post

Official

Post

Area Harvested

11790

11790

11765

11790

11700

11678

Beginning Stocks

966

966

1592

1592

1205

1208

Milled Production

34500

34500

34500

34500

34515

34488

Rough Production

51755

51755

51755

51755

51778

51737

Milling Rate (.9999)

6666

6666

6666

6666

6666

6666

MY Imports

1251

1251

217

220

100

150

TY Imports

598

598

100

50

80

40

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

36717

36717

36309

36312

35820

35846

MY Exports

25

25

4

4

0

4

TY Exports

25

25

4

4

0

4

Consumption and

35100

35100

35100

35100

35000

35000

Ending Stocks

1592

1592

1205

1208

820

842

Total Distribution

36717

36717

36309

36312

35820

35846

Wheat

2014/2015

2015/2016

2016/2017

Market Begin

Bangladesh

Jul 2014

Jul 2015

Jul 2016

USDA

New

USDA

New

USDA

New

Official

Post

Official

Post

Official

Post

Area Harvested

415

415

420

420

425

425

Beginning Stocks

1338

1338

1753

1751

2246

2033

Production

1300

1300

1300

1300

1335

1335

MY Imports

3915

3913

4693

4482

4700

4700

TY Imports

3915

3913

4693

4482

4700

4700

TY Imp. from US

87

0

0

0

0

0

Total Supply

6553

6551

7746

7533

8281

8068

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

4800

4800

5500

5500

6200

6000

Total Consumption

4800

4800

5500

5500

6200

6000

Ending Stocks

1753

1751

2246

2033

2081

2068

Total Ditsribution

6553

6551

7746

7533

8281

8068