GFMM desk: Bangladesh Bureau of Statistics estimates that the purchase of wheat and wheat flour is 1.5% of total food expenditure. This rate is very low compared to buying rice with a rate of 31.03. However, wheat constitutes the second essential food of Bangladesh, constituting about 12% of total grain consumption. This situation has made the country a possibility in the field of milling. Depending on the foreign aids for long years, Bangladesh has started to form a structure based on trade with its developments in years. Being one of the leading producers of the world rice production when evaluated in terms of agricultural production, the country shows a structure dependent on import for wheat. Becoming an active and rising participant in the world grain market with the increasing wheat demand, Bangladesh has almost doubled its wheat import in the last ten years.
Economy
Bangladesh economy has transformed from an economy depended on support to the one depended on trade for over 20 years. However Bangladesh hasn’t succeeded switching to the investment-oriented growth required for becoming a middle-income country. Ready-made clothing sector and worker incomes are the most dynamic fields of the economy. Bangladesh uses the power of the labor-intensive work with low wages that is the only abundant source of the country. The average annual income per capita has reached almost 1.500 Dollars. The experts state that the growth of GDP (Gross Domestic Product) with 7 % rate may decrease the poverty in the country significantly. The most important obstacle in reaching this goal is the slow growth speed of saving and investment rates. The rate of domestic savings to GDP in Bangladesh is 20 % and the rate of the investments to GDP is approximately 25 %.
Agriculture
62 % of Bangladesh land is cultivation area, 4 % is grassland and 15 % is forested. Rice ranks first among the most important agricultural products grown in the country. Wheat, pulses and oily seeds are other important agricultural products. Severe flood disasters in the country affect the agricultural production badly, give harm to products and people and affect the export in a negative way in the periods especially when the rice harvest decreases. 2/3 of total lands in Bangladesh can be cultivated but urbanization and erosions caused by the rivers are minifying the cultivated land each passing year.
Cereal
As we mentioned above rice ranks first among the most important agricultural products planted in Bangladesh. According to the estimations made by United States Department of Agriculture Foreign Agriculture Service (USDA FAS); the rice amount Bangladesh produced in 2012/13 season is 34 million tons. Bangladesh is among the four countries in rice producing in the world. Looking at the last 10 years of the country’s rice production volumes, it is seen that the production has increased around 36 %. According to the USDA data; 25,1 million tons of Bangladesh’s rice production in 2002/03 season has shown a gradual increase in the last years and has reached 34 million tons in 2012/13 season. But the country uses its almost all rice production for its domestic consumption and even the production doesn’t meet the amount required by the domestic consumption. When USDA data are analyzed 26,1 million tons of rice were consumed in 2002/03 season while the production was 25,1 million tons. Showing a similar case in the following years the deficit between the production and consumption is around 0,5 million ton in 2012/13 season. USDA foresees that 34,7 million tons of consumption will be realized against the 34,2 million tons of production Except the rice and wheat other cereal-based products in Bangladesh remain limited.
Milling & Sector Potential
As we mentioned above, Bangladesh is a country that has a limited wheat production but a place where wheat demand continues to rise. According to the Bangladesh Bureau of Statistics (BBS) the average per capita intake of wheat showed almost a 115 % growth between 2005 and 2010. This growth is mostly pronounced among the rural households where the daily average wheat intake of mostly 8 grams in 2005 reached to 23.3 grams in 2010 (bread and biscuits consumption isn’t included in this growth). The 2012 survey made by Bangladesh Institute of Development Studies, shows that the average daily per capita consumption of wheat flour is now 46 grams (83 grams for urban consumers and 25 grams for rural consumers). Bangladesh Bureau of Statistics estimates that wheat and wheat flour purchases constitute the 1.5 % of total food expenditures. This rate is really low compared to the rice purchases with a 31.03 % rate. However wheat has the feature to be the most important second food in Bangladesh by constituting almost 12 % of total grain consumption. This situation makes the country a potential in terms of milling.
Foreign Tade
Bangladesh reached a 46 billion-dollar foreign trade volume with 20 million-dollar export and approximately 26 million-dollar import value in 2010 and had a foreign trade deficit of nearly 6 billion dollars. As Bangladesh is dependent on imports especially on basic products, the foreign trade deficit is expected to increase till the beginning of 2016 and reach 11 billion dollars and during the year 2016 it is expected to reach 12.3 billion dollar. USA ranks first among the top ten countries with which Bangladesh makes export most. Realizing 4,5 million-dollar export to USA in 2010, Bangladesh realized 3,1 million-dollar export to Germany, 1,8 million-dollar export to England and 1,4 million-dollar export to France in the same period. China ranks first among the countries with which Bangladesh makes import most. Realizing an important part of the import from China, Bangladesh realized over 6,7 million-dollar import from China in 2010. India, Singapore and Korea follow China in Bangladesh import.
Place 0f Grains in Foreign Trade
Becoming an active and rising participant in the world grain market with the increasing wheat demand Bangladesh has doubled its wheat import in the last ten years. According to the USDA data; Bangladesh wheat import that was 1.3 million ton in 2002/03 season continued to increase in the following years and reached 3.9 million tons in 2010/11 season. Regressing a little after 3.9 million tons that was the highest amount of the last ten years, it is estimated that the import is 2.6 million tons in 2012/13 season. It is foreseen that wheat import will reach 3 million tons.
Canada ranks first among the countries from which Bangladesh imported wheat in 2011/12 season. It is estimated that the amount of wheat imported from Canada in this season is around 800 thousand tons. In the same season, 260 million tons from Australia, 119 million tons from Ukraine and 118 million tons from USA are imported. The aforementioned countries are the main wheat import suppliers of Bangladesh with their different amounts of import in different seasons. Rice and corn import remains in lower levels compared to other products.
Export Potential Producte
Rice is the most important cereal used in the country and wheat is the second mostly consumed cereal type. It is estimated that the amount of total consumed cereal per capita is 238 kilograms and wheat constitutes 7 % of this amount. As a result of increase in the level of income in the country, bread varieties and bakery products have taken their places in the supermarkets in big cities of the country. In this concept, it is considered that the demand for raw materials of these products and other additives will increase in the next period. The second most important import product in this sector is peas and nearly all of the supply of this product is realized by Canada. The chickpea import is mainly realized by Australia. Bangladesh has a 4.39 % share of world legumes import and is the third largest importer. The share of Turkey from the country’s import is 6.2. Biscuit are shown as the product with export potential to the country. Because the increasing income level and the spread of supermarkets has made consumers show more interest in imported products. Haque Brothers, Bengal Biscuits, Bangas Limited, Alamin Biscuit and Nabisco are among the leading biscuit companies operating in the country.
Source: Online/SZK
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