Monday, June 05, 2017

5th June,2017 daily global,regional local rice e-newsletter by riceplus magazine

Vietnam rice export back on track
Vietnam’s rice export growth has regained momentum this year after a year of slowdown, according to a report by the Vietnam Food Association (VFA).

Stevedores at work at a rice storehouse in the Mekong Delta. Vietnamese rice export has regained growth momentum this year after a year of plunge

Vietnam exported 2.3 million tons of rice worth US$1 billion in the first five months of the year, up 1.6% in volume and 1.2% in value year-on-year.China remained Vietnam’s largest rice importer, accounting for 47.5% of the nation's total rice exports. More than 815,000 tons of rice costing over US$376 million went to the northern neighbor in January-April, up 16.1% and 16.2% against the same period last year respectively.

Vietnam shipped 4.89 million tons of rice valued at US$2.1 billion in all of 2016, a respective decrease of 25.54%  and 20.57% against 2015.China was still Vietnam’s biggest importer of the food staple last year despite a 19.79% decline. It purchased more than 1.8 million tons of rice from Vietnam last year, 36.97% of Vietnam's total rice shipments.The domestic rice price has improved by VND200-300 a kilo, supported by the recent signing of a memorandum of understanding to export one million of rice a year to Bangladesh until 2022. The South Asian country will import 300,000 tons at first.
In addition, the National Food Authority (NFA) of the Philippines has announced to buy 250,000 tons of rice from Vietnam in June.Nguyen Thanh Tho, a rice trader at Ba Dac wholesale market in Tien Giang Province, told the Daily that IR 50404 rice is sold at VND4,350-4,400 a kilo, an increase of VND200-300, helped by the Bangladesh rice deal.Besides, IR 50404 material rice is purchased at VND6,350-6,450 a kilo in the Mekong Delta, up VND200.Major importing markets, especially Bangladesh and the Philippines, have helped buoy the price. The Free On Board (FOB) price of 5%-broken white rice from Vietnam is US$370-380 a ton, up US$5-10 compared to a week ag

Rice prices will fall after imports arrive, says agriculture minister

The rising prices of rice due to the loss of the Haor harvest will drop once imports arrive in the market, says Agriculture Minister Matia Chowdhury.
“No one will deny that the price of rice has risen a bit recently,” she told reporters at a press conference at the Osmani Memorial Auditorium in Dhaka on Friday.But there is a tendency to ‘exaggerate the extent’ of the rise in prices, the minister said.The food ministry has officially proposed the import of rice and more is to come on a ‘G to G’ basis, eventually stabilising the market, she said.
“No one can say the market prices have spiralled out of people’s ability to purchase,” Matia said, “The fact is everyone is buying and eating rice. There will not be a shortage in the future either.”
According to the calculations by the food ministry, the flooding in the Haors or backswamps has led to the destruction of approximately 600,000 tonnes of rice.
But non-government agencies say the amount of rice destroyed is close to 2.2 million tonnes

Japan starts growing genome-edited rice plants outdoors in national first

 (Mainichi Japan)
Genome-edited rice plants whose outdoor trial cultivation has begun for the first time in Japan are pictured in Tsukuba, Ibaraki Prefecture, in this recent photo. (Mainichi)
TSUKUBA, Ibaraki -- A food research body here has started growing genome-edited rice plants outdoors on a trial basis for the first time in Japan.The trial by the National Agriculture and Food Research Organization is a step toward practical application of genome editing, a new technology that is expected to significantly increase the yield of rice plants. However, it is not yet clear whether Japan will classify these plants as genetically modified crops, and the country has yet to formulate rules, so it remains unknown whether such crops can be introduced smoothly.
In the editing process, two genes in the rice plant are stopped from functioning through the addition of other genes that serve as "molecular scissors." By changing the plants' hormonal balance, the number of husks in each ear of rice increases, as does the size of the rice grains themselves.
The process is part of a national strategy to further develop agriculture and expand exports. The final target is a 50 percent increase in the yield of crops.
The central government approved genome editing of rice plants in April, after experts gave the green light. On May 23, the National Agriculture and Food Research Organization planted the rice in an isolated experimental paddy. The rice will be harvested in October, and officials will check whether the genome editing has had the desired effect, whether pollen is being dispersed from the plants, and whether there have been any unintended changes.
In the meantime, it remains uncertain whether crops produced through genome editing will be subject to the law restricting the release of genetically modified crops into the environment, commonly referred to as the Cartagena Act.
In the latest experiment, external genes are added to the rice plants at the cultivation stage, but as a result of repeated cross-fertilization, by the time rice becomes food, none of the added genes remain. Researchers say this is no different from natural mutation.
The question of how to deal with modified crops when none of the external genes remain has been a point of focus across the world. New Zealand, for example, restricts such crops, but Argentina does not. Full-scale discussion on the issue has not yet begun in Japan.
Resistance to genetically modified food remains strong in Japan. Consumer groups have raised concerns about the latest experiment, with one of them, Seikatsu-Club, warning that the modified crops could cross with other ones.
Hideaki Karaki, director of Japan's Foodservice Industry Research Institute, however, says there is no need for alarm.
"In cases where the added genes do not remain, it's no different from natural mutation. It's strange to focus one's worries on the process."
Akira Komatsu, a senior researcher at the National Agriculture and Food Research Organization, commented, "China is developing rice plants through genome editing at an unstoppable pace, and we're wary of international competition. We want to improve our results through trial cultivation, and strive to provide accurate information.

A warning whose time has come

azera parveen rahman
Danger in the water: Like hundreds of children in Assam’s Hojai district, farmer Dilwar Hussain’s son is crippled by fluorosis azera parveen rahman
Threat of fluoride contamination in crops looms large in Assam
Dilwar Hussain may not be able to give you the exact scientific explanation for how excessive fluoride can harm one’s bones and teeth, but he knows that it crippled his young son, causing his legs to bend.
Children suffering from skeletal and dental fluorosis — marked by stained and crooked teeth, and bent legs — are a common sight in Hussain’s village, Tapatjuri, in Assam. Fluoride-contaminated water, as the State’s Public Health Engineering Department (PHED) has found out, is the main culprit, and the entire Hojai district is among the worst-affected.
What is more worrisome now is the high fluoride content in agricultural produce as well, including rice and tea, the two main crops of the State.
Dharani Saikia, secretary of voluntary organisation Environment Conservation Centre, has been working on the issue for more than a decade and government agencies approach him for his expertise. He recalls that the first time they detected high fluoride levels in food produce was in 2012. Until then, public awareness was limited to discouraging the use of groundwater from tube-wells. Ring-wells were recommended instead.
“On a hunch, we decided to test the rice grown on a 10-bigha field in the village. We took samples to the Pollution Control Board office in Guwahati and found they had a fluoride level of 74 ppm. The borewell water that was used for irrigation had 12 ppm fluoride,” Saikia said. The WHO standard for permissible fluoride limit is 1 mg/l (0.6-1.5 ppm). Since the same water source was used over and over again for irrigation, the levels were escalated in the crop.
A wake-up call
The findings led to officials finally sitting up and taking note of the problem. Saikia says the PHED set up a Fluoride Mitigation Centre, led by the district collector. Saikia, too, was part of the intervention.
“Climate change is a major reason for high fluoride levels in groundwater. Less rainfall means less water replenishes the water table... Bore-wells are being drilled closer to the granitic rocks that are rich in minerals like fluoride. So that’s how the concentration of fluoride is increasing in groundwater,” he explains.
In Tapatjuri, farmers like Hussain, Lakhmi Kalita and Indra Basomatary were reliant on groundwater, which had been pumped up by drilling down to 250-300 ft. After the findings, the use of such water was stopped even for agriculture. All groundwater had to be tested first for safety.
“We are not taking any more chances. We have many ponds in our village from which we now source water for agriculture,” Hussain says. After Hojai, a Fluoride Mitigation Centre was also set up in the adjoining Nagaon district.
But the problem of fluoride contamination is not Tapatjuri’s alone. An official survey found water with fluoride levels above the permissible limit in 11 districts in the State.
Dread in a teacup
Saikia says that in 2016 he tested tea from the local market at the health department’s lab and found 5.6 ppm fluoride. Green tea, he adds, is known to have 2 ppm fluoride.
AK Barooah, director of the Tocklai Tea Research Institute in Assam, however shrugged off any worry over the threat of fluoride contamination in the ‘cup that cheers’. “Tea naturally contains fluoride, which it absorbs from the soil, and there is nothing to be concerned about it at the moment.”
Experts like Najibuddin Ahmed, former additional chief engineer of the Assam PHED, call for extensive studies on food contamination. “The Jorhat-based Rice Research Centre is studying contamination of rice. But there isn’t enough data,” he says.
Scientist RN Bhagat, who was associated with Tocklai until recently, agreed. “There has been some research on the correlation of water contamination with tea. But such studies are sporadic.”
Saikia believes that along with research, coping mechanisms have to be developed. “Going back to nature and to surface water, like ponds and rivers, after it is treated is the way forward,” he says

Recent rains concern rice growers


MAMOU — Continual rainfall in the past few days has farmers worried about disease problems in their rice crop, an LSU AgCenter plant pathologist said at rice field days held in Jefferson Davis and Evangeline parishes.“In the last week and a half, I’ve probably had 20 to 30 disease calls,” said LSU AgCenter plant pathologist Don Groth, speaking at the Evangeline Parish rice field day on June 1.Groth also spoke about those concerns at the field day held the previous day in Fenton.
Groth urged farmers to scout their fields and to use fungicides on time, usually at the boot stage with 2- to 4-inch panicles in the head. But a treatment for blast disease should be applied at heading.“Once an epidemic gets going, it takes a lot more to stop it than if you catch it in the beginning,” he said.Sheath blight is showing up in some fields, but occurrence is erratic. Fields where soybeans are planted in rotation with rice are more likely to have the disease than rice fields following crawfish, Groth said.
Blast disease has not been a problem so far.“If you see it, make sure everything is flooded,” he said.Fungicide applications should be avoided immediately after or before a rain, he added.AgCenter rice breeder Adam Famoso said a new genetics lab funded by the Louisiana Rice Research Board is providing new benefits with improvements in the foundation seed program. Varieties grown for seed at the AgCenter H. Rouse Caffey Rice Research Station can be screened to minimize off-types.
AgCenter rice breeder Steve Linscombe said last year’s flooding resulted in some rice seed with low vigor. Some of the plots at one of the field day locations were seeded with low-vigor seed, and those plots were more adversely affected by recent heavy rainfalls.A Clearfield Jazzman line under development will have improved yield from previous versions of Jazzman. “I think this market will slowly continue to expand,” he said.AgCenter rice specialist Dustin Harrell said the rice crop got off to a good start this year with a warm winter and spring that allowed early planting.
This year’s crop of 400,000 acres in Louisiana is about 8 percent lower than last year.“Everything was looking good until late April when we got significant rainfall,” he said.About 4,000 acres of rice were lost in Louisiana because of floods, but rice acreage in Missouri and Arkansas had more significant losses, with more than 150,000 acres ruined in Arkansas.Harrell said a new product to prevent nitrogen fertilizer losses will be available in 2018.AgCenter entomologist Blake Wilson said a high percentage the for Louisiana rice acreage was treated with Dermacor, suggesting that heavy dependence on the product could lead to resistance problems.

No insecticides can be used in fields where crawfish are raised, but farmers can reduce stinkbugs by keeping levees and ditches mowed, he said.The rice leaf miner is showing up this year, he said, but it poses little threat to yield.AgCenter weed scientist Eric Webster said the herbicide benzobicyclon could be available in Louisiana next year as Rogue. The product is good for controlling aquatic weeds, but it does not have the broad spectrum weed control of another new product, Loyant, he said.AgCenter plant pathologist Boyd Padgett said this year’s soybean crop looks good so far. “I’m impressed with the crop overall,” he said.
The U.S. Department of Agriculture estimates that 94 percent of the Louisiana soybean crop is planted, and 14 percent is blooming.
Farmers are concerned about how long soybeans can survive flooded conditions, Padgett said. Research indicates soybeans can survive 48 to 96 hours of flooding, but it depends on growth stage, temperature after drainage and water clarity.AgCenter plant pathologist Trey Price said the soybean disease called taproot decline is caused by a fungus. LSU graduate students have several studies underway on the problem.Taproot decline is unlikely in south Louisiana because the disease is found in fields where soybeans are planted in consecutive years, he said.Work is ongoing to find a solution to Cercospora that is resistant to fungicides. “I think resistant varieties will be our ultimate solution to resistant Cercospora blight,” Price said

Governors blame jonathan substandard rice Nigeria
- The Nigeria Governors Forum (NGF) expresses concern over the quality of rice being imported and consumed by Nigerians - The 36 governors urge the Nigeria Customs Service (NCS) to bring the situation under control - The governors frown at the situation where Nigerians snub locally-produced commodity in preference for foreign ones which are most of the time, stale, contaminated or even fake The Nigeria Governors Forum (NGF) has blamed the Jonathan administration for the huge consignment of substandard rice still finding its way into the Nigerian market.
Presidency reveals why Osinbajo postponed budget signing The governors on Thursday, June 1, expressed concern over the quality of rice being imported and consumed by Nigerians. The Forum said the consignment of rice still finding its way into the market was imported into Nigeria since 2014. It said at the time, the Jonathan administration issued a very liberal import licence regime to its election financiers who were able to bring a substantial quantity of rice into the country using a waiver from the presidency at the time, The News Agency of Nigeria (NAN) reports.
The governors said some Nigerians were either falling sick or losing their lives to the consumption of this substandard rice The governors in a statement issued by the head, media and public affairs of the NGF Abulrazaque Bello- Barkindo, urged the Nigeria Customs Service (NCS) to bring the situation under control. The 36 governors stated some Nigerians were either falling sick or losing their lives to the consumption of this substandard rice. PAY ATTENTION: Read the news on Nigeria’s #1 new app ADVERTISING ADVERTISING inRead invented by Teads inRead invented by Teads They also frowned at the situation where Nigerians snubbed locally-produced commodity in preference for foreign ones which were most of the time, stale, contaminated or even fake. Meanwhile, the Western Marine Command of the Nigeria Customs Service (NCS) on Thursday, May 26, said it has impounded 941 bags of foreign per boiled rice valued at about N6.8 million. The Controller of the command, Sarkin Kebbi, said this at a news conference in Lagos.
”The impounded rice is valued at N6,830,719, a Duty valued N4, 781,503 and duty paid valued N11,612,322. learnt that the controller, who displayed the commodity, said the feat was achieved through a renewed resolve of the officers to stamp out smuggling. ADVERTISING inRead invented by Teads ADVERTISING ADVERTISING inRead invented by Teads inRead invented by Teads Kebbi said that on resumption of duty a month ago, he made known to the officers the mandate given to him from the customs headquarters. In the video below, traders lament bitterly over prices of goods, as they accuse President Muhammadu Buhari's administration of turning things upside down. READ MORE   by Taboola Sponsored Links YOU MAY LIKE Photographer Finds Something Incredible In Hitler's Forgotten Bunker Trend Chaser 14 Billionaires With Gorgeous Wives & Exs Hooch 30 Cars That Will Last More Than 250,000 Miles BuzzDrives The Ultimate Cheap Flights Finder is Here! Cheap Flights Made Easy
Now You Can Track Your Car Using Your Smartphone Smart Device Trends THINK IT IS IMPORTANT? SHARE WITH YOUR FRIENDS! SHARE ON FACEBOOK SEND VIA EMAIL RECOMMENDED NEWS Ex-president Jonathan’s aide, 3 other ex-Nigerian officials named in $20million bribery scandal in Switzerland Ex-president Jonathan’s aide, 3 other ex-Nigerian officials named in $20million bribery scandal in Switzerland No Nigerian can point to a single lie from me - Lai Mohammed No Nigerian can point to a single lie from me - Lai Mohammed Read more:

Traders and importers present their grievances on Maximum Retail Prices to Minister 
Sat, Jun 3, 2017, 04:45 pm SL Time, ColomboPage News Desk, Sri Lanka.
June 03, Colombo: A powerful but a perturbed retail market supplier collective in Sri Lanka has voiced that the prohibited market practice of mixing imported and domestically milled rice could be overcome with a simple move, instead of resorting to punitive official raids.
Colombo Traders Association (CTA) in a meeting with the Minister of Industry and Commerce Rishad Bathiudeen on Thursday has pointed out that Maximum Retail Prices (MRPs), imposed by the government have become an impediment, hampering Sri Lankan consumer's well-being, rather than improving it.
Minister Bathiudeen has called the meeting with the CTA to especially to hear the grievances of supply side of the retail sector.
The 210- member CTA, 90 percent of which are large volume importers and distributors and committed tax payers, regularly pays taxes to the Inland Revenue Department in multi-billion Rupee levels.
Top CTA representatives attended the meeting included Chairman of CTA YM Ibrahim (Chairman, Ishana Exports Pvt Ltd-a leading exporter of spice), CTA Deputy Chairman SM Zaneer (Chairman, KTC Group-the main importer of dates, raisins & sultanas for Lankan market and also a leading rice miller), and CTA Secretary Sooriyar (Chairman of Sooriyan Traders-large scale importer of essential food items to Sri Lanka).
The meeting was also attended by Minister's top officials in charge of retail across such institutions as the Consumer Affairs Authority, the CWE and Lanka Sathosa).
CTA Deputy Chairman Zaneer said the MRP on an imported product cannot be fixed as the prices change seasonally and the dollar rate too fluctuates and therefore, the MRPs should be changed very often to give the best to the consumers
"We at CTA support that there should be an MRP for rice varieties which is our staple food. More importantly, there is a large local industry of farmers and millers who should be safeguarded. Rice MRPs therefore prevent consumer exploitation. But should other essentials too be given MRPs? Only small amounts of other items are locally produced but large volumes are imported," he asked.
He said that even for rice, there should not be a practice of different prices for imported and domestic rice.
Zaneer said a main reason for illegal mixing of rice is the arbitrary price structure and proposed equal prices for both imported and domestically milled rice in the local market.
He said it can be done by a simple move -by increasing the duty on imported rice by as little as Rs 10.
"Raids are needed to prevent abuse but the present system of raiding is harsh and they show no mercy. Once my raided stocks were taken and destroyed even though all criteria fulfilled and the labels were in order. Then the wrong party was accused once -one of my product packs purchased by a seller that was unsold and kept in a corner in seller's shop then later expired, was detected and instead of the seller I, the original manufacturer was accused since the label shows me as the manufacturer."
Chairman of CTA, YM Ibrahim explained how MRPs often do not result in the 'best price' as intended.
"The MRPs are imposed to safeguard the consumers, which we believe to be important. However, some members in our association do not see any benefit in maintaining the same MRP on certain products (other than rice) over a longer time. Our MRPs are not changing in line with the global market rates. In that, the MRPs are effective in the market at times of shortages, maintaining the price of the essential item without increasing it further. But unfortunately, often our MRPs continue to be enforced long after international market price of the same commodity has fallen even below the local MRP. As a result we find local consumers continue to pay higher prices for the item when the actual price of the commodity should be much lower. Also, when the international market price of the commodity is higher than local market MRP, then the importer is not able to import since the importer is bound to sell at the lower MRP incurring losses since they are compelled to sell at lower MRP than the international price. Therefore we are compelled to not to import at such times, which creates shortages in the market, hampering the consumer well-being and us also losing business in the meantime," he explained.
Ibrahim said the way to overcome this is by opening more towards global and dollar rates for essential items other than rice, and for rice, allowing a uniform price for both imported and locally milled rice."We propose a single, flat price tag for both locally milled and imported rice of same varieties by bringing in a simple import duty."Minister Bathiudeen thanking the CTA for bringing these issues to his attention said since MRPs and raids on errant traders are to safeguard consumers and directed by the Cost of Living Committee, CAA and higher levels of the government, he on his own, will not change its implementation.
"MRPs also need more study and closer watch. We are here to safeguard consumers and we focus on the market/demand side. Today for the first time we hear the supply side situation from CTA and these issues too need to be studied," the Minister said.He instructed the CTA to make these representations and recommendations in writing immediately to him so that he can present it to higher levels to decide the way forward on giving best price & quality on all essential items.Selling essential items above the designated MRPs is an offense in Sri Lanka. Chicken meat, red Dhal/lentils, sprats, chickpeas, green grams, canned fish, white sugar, white flour, full cream milk powder, potatoes, Sustagen, B-onions, dried chilies, dried fish, and Maldive fish are among the items gazetted by the government as "Essential".

Higher market rate puts damper on Boro procurement drive in Rangpur
Our Correspondent
RANGPUR, June 03: Boro rice procurement target may not be achieved in the district during this season due to higher price of rice in local markets compared to that of government rate.
According to sources government procurement drive began in the district on May 1 with a target to purchase 17,648 tonnes of Boro rice in the season. But so far 220 millers signed contract for supplying 4,905 tonnes of rice which is one fourth of the target, sources alleged. The millers so far supplied only 300 tonnes of rice to government warehouse, sources further alleged.

Sources said the government decided to buy rice from millers at Tk 34 per kg but presently per kg coarse rice is selling at Tk 44 to Tk 45 in local markets which is higher than government procurement rate.
As the market price of rice has remained high, millers, who signed contract with the government, are showing their reluctance to supply rice to the government godowns, sources said. number of millers said as market price of rice is higher than the government procurement rate they prefer selling rice at local markets instead of selling it to government purchase cenres.
Requesting anonymity a rice mill owner said he has signed a contract to supply 30 tonnes of rice to government go downs. If he supplies the rice to government warehouse presently, he will have to incur around Tk 0.2 million to Tk 0.3 million. Whereas he can earn good profit by selling it in local markets, he added.
General Secretary of Rice Mills Owners' Association, Rangpur Shamsul Alam said he signed a contract to supply 50 tonnes of rice to government godowns. But presently he is not eager to do that because of higher price of rice in local markets than government rate.District food controller, Shahjahan Bhuiyan said rice procurement drive started in the district last month and it is expected to continue till August 31.
Presently it is going on at slow pace due to the apathy of the millers to sell rice to government purchase centres. He hoped that the millers would supply rice to government warehouse within the stipulated time.

Decision time for rice brand
The debate continues on the single brand to be used for Cambodian rice exports. KT/Chor Sokunthea Government task forces will meet this week to finalise a single brand under which Cambodian rice will be exported. Those at the meeting will include the Cambodia Rice Federation, the Agriculture Ministry and the Commerce Ministry.  “We don’t know when the exact date for registration will be because they just applied for registration last week,” said Op Rady, director of the intellectual property rights department of the Ministry of Commerce. “We have talked several times. The CRF wants to use the name Angkor Malis but the Agriculture Ministry suggested it reconsider the name. Hean Vanhan, director-general the general directorate of agriculture, said registration of a single rice brand was the duty of the commerce ministry. Agriculture officials said Cambodia had more than 10 varieties of fragrant rice, and should not single out one as a single brand.  “The CRF selected ‘Angkor Malis’ as the brand, but this is not right because there is already a rice seed called malis,” Mr Vanhan said.  “What the private sector wants to do is to steal foreign branding to make the rice similar to Thailand, since the Thai Hom Mali is already famous.  “If we use ‘Angkor Malis,’ which is specific only to Cambodian premium rice ‘malis,’ it has a different taste to Cambodian fragrant rice such as phka romduol, phka chansensor and phka khnei.  “If customers buy Angkor Malis one day, it may have a different taste when they buy it in the future, even though it carries the same brand,” Mr Vanhan said.  He suggested that a non-specific ‘Angkor Rice,’ with the specific variety written underneath would help clear up the confusion and prevent people from thinking they were buying a specific rice variety when they might be buying a different premium rice. CRF secretary-general Moul Sarith said all documents for brand registration had been prepared but the CRF wanted a common name and agreement from stakeholders.  “We have already summited to the Ministry of Commerce for registration on the national rice branding and we plan to finish by June. “Now we have to meet with Agriculture Ministry to decide the common name and we want all relevant stakeholders to agree a single name,” Mr Sarith said.   Mr Sarith added that after several talks involving CRF management and studies both of the local and international market, the CRF wanted the rice to be branded ‘Angkor Malis’.  “However, the Ministry of Commerce asked us to recheck the name while Ministry of Agriculture suggested that we get a better name. “Thus, we want to have a meeting with Agriculture Ministry and Commerce Ministry to decide the name. We have enough documents for registration. When we finish the meeting, we want to register at the same time,” Mr Sarith said.   Song Saran, CEO of Amru Rice (Cambodia) said previously that the long delay in choosing a brand name meant that exporters were still using their own  names for Cambodian rice, such as jasmine rice or fragrant rice.  “We suggest having one name to identify Cambodian premium rice since we don’t want each company having different names and standards for export to foreign countries,” Mr Saran said. “We want Cambodia to have a single brand and standard.”
A jump in subsidy to contain rice price

Subsidies on food will rise to 20.10% year-on-year to Tk1,215cr due to a hike in staple prices though the international market rates remain unchanged SYED ZAKIR HOSSAIN
For the agricultural sector, the subsidy was cut by Tk3,000cr to Tk9,000cr in the revised budgetary outlay as fertiliser prices fell in the international market
As the government will hike subsidy expenditure from Tk23,830cr in this year to Tk28,045cr in the next fiscal year, subsidy spending is likely to increase by 17.69% due to the impending food shortage and supply of rice at low prices to the poor, according to the Finance Ministry. Around Tk4,545cr has been allocated for food subsidy. In the original budget for the current fiscal year, the allocation was Tk2,820cr, which was revised upwards to Tk3,721cr to accommodate a programme introduced last year to sell rice at Tk10 a kilogram to the poor. Fuel and power dominated the state’s subsidy policy in the last some years. Now, food and agriculture will get priority as the country is likely to see a food shortage because of the recent floods, a Finance Ministry official said. For the agricultural sector, the subsidy was cut by Tk3,000cr to Tk9,000cr in the revised budgetary outlay as fertiliser prices fell in the international market. Food related subsidies will rise to 20.10 % year-on-year to Tk1,215cr owing to an increase in  staple prices despite the rates remaining unchanged in the international market. The subsides will be required as the government plans to sell rice and wheat at lower prices in the upcoming fiscal year, as it is doing in the current one. Each kg rice and wheat sells under the government’s Open Market Sale programme at Tk15 and Tk17 respectively, while the government’s latest procurement price for rice is Tk 32 a kg. Exports and jute subsidies will remain the same as the current year’s amounts of Tk4,000cr and Tk500cr respectively. As Bangladesh Petroleum Corporation made lofty profits for several years as fuel prices in the international market were comparatively lower, no subsidies have been given to fuel sector. The state-owned organisation received a total of Tk42,000cr in subsidies in the last eight years. Petrobangla will likely get Tk2,500cr as cash credit to purchase gas from international oil companies (IOCs). The national oil company will use the credit to partially pay Tk5,500cr  of its dues to the National Board of Revenue. Petrobangla buys gas from the IOCs at Tk292 per 1,000 cubic metres, which include their income tax, but it sells the same volume of gas at Tk176, including taxes. Hence, the company pays a subsidy of Tk126 for every 1,000 cubic metres of gas. Also, the government last year started waiving taxes on gas at the time of import or purchase including 15% VAT. The power sector will get a subsidy of Tk5,500cr, which is the same as allocated in the FY2016-17. Before the budget announcement, Finance Minister AMA Muhith made his yearly rhetoric that the total subsidy would drop to a minimum level, but his assumption failed in the last two fiscal years as the subsidy outlay saw a rise