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Bangladesh wheat importers go for early booking
Publication Date : 31-08-2012
Import orders for wheat jumped in July as the Bangladesh government and private importers gear up efforts to buy early amid spiralling prices globally.
The worst-ever drought in the USA and fears of an export curb by Russia for a dimmed production outlook pushed up the prices in the recent months.
Many importers have booked early to ward off the risk of higher prices, said Abdus Samad Labu, vice chairman of S Alam Group, a commodity importer.
Opening of LCs (letters of credit) jumped 343 per cent to 204,000 tonnes in July from 46,000 tonnes in the same month a year ago, according to the Bangladesh Bank (BB), the country's central bank.
Settlement of LCs also rose by 92 per cent to 264,000 tonnes in July from 137,000 tonnes a year ago. LCs in terms of value also soared, BB data showed.
The prices of US wheat -- both hard red winter (HRW) and soft red winter (SRW) varieties -- rose by more than US$70 each tonne in July from a month ago, according to commodity market data of the World Bank.
On August 24, the prices of SRW variety stood at $344 a tonne, showed the latest issue of Fortnightly Foodgrain Outlook of the government's Food Planning and Monitoring Unit (FPMU).
Global wheat production, stocks and exports are forecast to decline in 2012-13, said the FPMU publication, citing US Department of Agriculture.
World wheat production is projected to decline by 4.7 per cent to 662.8 million tonnes, said USDA in mid-August, cutting down output forecasts for Russia and Kazakhstan.
Also, the domestic market for pulses has started to rise, influenced by soaring global prices.
Retail prices of pulses rose by 12 per cent to 30 taka ($0.37)- 35 taka each kilogramme in the city markets yesterday from a month ago, according to Trading Corporation of Bangladesh.
Badrul Hassan, director of procurement of Directorate General of Food, said the government has a plan to import 800,000 tonnes of wheat during the current fiscal year. So far, it has imported 137,000 tonnes.
But he said: "We want to import a major portion of the planned quantity in the next three-four months to avoid the risk of increased prices in future."
Hassan also said the bidding process to buy a total of 100,000 tonnes of wheat has started. More bids to purchase up to 400,000 tonnes will be floated in the next couple of months, he said.