Flooding trims Bangladesh rice outlook

Flooding is taking its toll on rice production in Bangladesh, lowering the outlook for harvested area to 11.5 million hectares and milled rice to 36.8 million tonnes in the 2024-25 marketing year, according to a report from the Foreign Agricultural Service (FAS) of the US Department of Agriculture.

The FAS also reduced its 2024-25 forecast for the consumption of rice, the country’s top staple crop, to 37.7 million tonnes, which is 300,000 tonnes lower than its previous forecast due to lower production and higher prices. Since August 2022, Bangladesh has been experiencing very high inflation, which has affected the purchasing power of consumers, the FAS noted. 

Since July 31, neither the government nor the private sector have imported rice into Bangladesh, the FAS said. Additionally, with India’s restriction on non-basmati white rice exports and high international prices, it is unlikely that Bangladesh will import rice from the international market, as the import costs would be higher than the domestic prices.

Considering the reduced production and challenges with rice imports, the FAS is forecasting that the domestic price of rice will continue to rise in the near term.

“As a result, rice consumption is expected to decrease, while wheat consumption is likely to increase, as coarse wheat flour (aata) remains a cheaper alternative to rice,” the FAS said.

In Bangladesh, wheat is the second most significant staple food after rice. Local production accounts for 15% of the total demand. For 2024-25, the FAS forecasts wheat harvested area and production at 310,000 hectares and 1.1 million tonnes, the same as the 2023-24 estimate.

The import forecast for wheat to 6.6 million tonnes, up 6.5% from the previous FAS forecast, is based on currently stable international prices, smooth supply, and higher domestic consumption. For 2023-24, the FAS revised its wheat import estimate to 6.8 million tonnes, based on the final trade data from Bangladesh’s Ministry of Food and the Ministry of Agriculture, up 33% from 2022-23.

As India banned wheat exports in May 2022, Bangladeshi importers have sought alternative sources for wheat with Russian wheat becoming a preferred source for millers. Ukraine, Canada, Australia, and Brazil also are exporting to Bangladesh.

Total wheat consumption is projected to be 7.7 million tonnes in 2024-25, up from the 7.5 million tonnes estimated for the previous marketing year and 6.7 million tonnes in 2022-23. Higher demand at the household level, along with greater demand for biscuits, confectionaries, pasta, noodles and bakery items, are helping drive consumption.