Poster in Feb 12, 2024 14:02:02

Major industrial groups involved in the export of dry food products

Major industrial groups involved in the export of dry food products

Total exports of agriculture and agro-processed products fell from $1 billion to $84 crore 30 lakh in the last financial year. Out of this dry food export was 20 crore dollars. Exports of this sector are increasing.

A decade ago there were only a handful of industrial groups in the dry food export market. This market was limited to a few industrial groups including Pran-RFL, Square Group, and ACI Foods. However, in the last few years, new industrial groups have joined the export market in front of the global market. These industrial groups have been marketing food products in the country's market for so long.

Apart from the domestic market, they have now focused on exports. Again, due to the dollar crisis in the country, the groups are trying hard to increase exports. But still one of the targets of the companies is the market of expatriate Bangladeshis living abroad.

According to Export Promotion Bureau (EPB) and National Board of Revenue (NBR) data, a decade ago the export of dry food products was worth US$ 4 crore 52 lakh in the fiscal year 2012-13. A total of 172 exporting companies export food products to 43 countries of the world. In a decade, the export of dry food products has increased to about $20 crore in the fiscal year 2022-23. Currently, 212 companies export these food products to 93 countries of the world. Export products include Biscuits, Cakes, Muri, Semai, Noodles, Bread-Parata etc.

Big company in export

The Pran-RFL group has been single-handedly leading food product exports for a long time. The group alone exported 49 percent of the dry food products exported last fiscal year as well. Companies like Meghna Group of Industries, Abul Khair Group, City Group, Ispahani Group, Bashundhara Food and Beverage, TK Group, Akiz Resources, and Samuda Group have joined the export of dry food products in the last decade. Apart from these big groups, small and medium companies are also exporting these products.

Meghna Group of Industries (MGI) has been focusing on exporting food products for one and a half years. The group started a food manufacturing plant named Meghna Noodles & Biscuit Factory in Meghna Economic Zone three years ago. Exports from this factory started last financial year.

Meghna Group of Industries Chairman Mustafa Kamal said, "The global food market is very big. Emphasis on the export of food products to diversify exports. If entrepreneurs come forward and government support is given, it will become a potential sector for export.”

Among the major industrial groups, TK Group joined the export of dry food products a year ago. The group has been marketing Pusthi brand food products in the country. At the beginning of exports, the group exported various food products including Biscuits, Chanachur, and Semai to the Middle East and India. The group's subsidiary Samuda Group has also started exporting food products.

Director of TK Group, Mostafa Haider, told Prothom Alo, "Earlier, we were marketing dry food products in the domestic market. Now I have been involved in exports for years for value addition. Our exports are mainly aimed at expatriate Bangladeshis.

Citigroup earlier exported agro-processed products but has joined the export of dry food products since the last financial year. The group exports various types of dry food products including biscuits, and clothes. Akiz Resources Limited also started exporting dry food products a year ago.

Dry food products are mainly made from one or more ingredients such as cereals, flour, flour, potatoes and milk. Most of the raw materials for food production are produced in the country. Wheat, the main ingredient for making food products, is still dependent on imports. The rest are produced in the country.

A sub-sector of agricultural and agro-processed products with a low export share in the global market is dry food products. Total exports of agriculture and agro-processed products declined from billion dollars to $84 crore 30 lakh last fiscal year. Out of this dry food export was 20 crore dollars. Exports of this sector are increasing.

The global market for dry food products is huge. Compared to that, Bangladesh's position in this sector is still at the bottom. However, entrepreneurs are seeing the possibility of increasing export income in this sector as large industrial groups are involved in the export of this sector.

According to the latest data from the International Trade Center, the global dry food market in 2022 was worth $9,771 crore. In 2022, the position of Bangladesh was 64th in the global list. A decade ago in 2013, Bangladesh was ranked 77th in dry food exports.

Indirect incentives can be given by the country's major industrial groups emphasizing food exports at a time when the government has reduced cash support for exports. Bangladesh Bank issued a notification in this regard on January 30.

According to the notification, in 2026, Bangladesh will become a developing country out of the list of Least Developed Countries (LDC). Export incentives or cash assistance of any kind cannot be given as per International Trade Organization (WTO) regulations in case of transition to developing countries. However, the export sector may face a challenge if the cash assistance is suddenly withdrawn after the transition from LDCs. For that, the government has decided to reduce the cash assistance little by little from this year, the notification said.

​According to the notification, cash assistance on agricultural produce and processed agricultural produce has been reduced from 20 percent to 15 percent. That is, earlier, exporters used to get Tk 20 incentive if they exported products worth Tk 100. Now you will get Tk 15.

Entrepreneurs fear stumbling due to reduced incentives.

They say that Bangladesh has not yet made a strong position in the world in the export of dry food products. Due to the increase in gas and electricity prices, the cost of production has also increased. For this reason, the entrepreneurs in this sector need the support of the government.

When asked, Center for Policy Dialogue (CPD) research director Khandaker Golam Moazzem said, the global export market for dry food products is huge. Large industrial groups are looking at exporting dry food products, which is a positive aspect. This may further increase the diversity in exports.

Golam Moazzem also said that due to the regulations of the International Trade Organization, cash assistance cannot be given when moving from less developed countries. For this, strategies like India can be adopted so that small and medium enterprises can survive in the global competition in this sector. Such as encouraging investment without direct incentives, and cooperation to capture export markets.

​Source: Online/GFMM

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