Home ›› 24 Sep 2022 ›› Front
Onion production is increasing every year due to the government’s all-out initiatives to become self-sufficient since the Indian export ban in 2019 but Bangladesh is still struggling to reduce import dependency.
Production has gone up by 11.74 lakh tonnes in the past three years, between fiscal years 2018-19 and 2021-22. The country produced record 35.04 lakh tonnes of onion in FY2021-22, which is 1.42 lakh tonnes more than the previous year’s production of 33.62 lakh tonnes.
Moreover, some 2.592 lakh hectares of land came into onion production in FY22, which is 5,800 hectares more than the previous year’s 2.534 lakh hectares.
It was expected that the increase in both acreage and production volume would significantly reduce onion import. However, the country is still heavily dependent on onion imports. The import volume in FY22 had surpassed the previous year’s volume despite record production.
Experts have held floods and the supply disruptions they caused, high prices in the local market, and low prices in the Indian market responsible for the traders’ decision to import more.
Bangladesh imported 6,64,772 tonnes of onion in FY22, which is 1,11,421 tonnes more than the previous fiscal’s 5,53,351 tonnes. Moreover, despite increased production and import, onion prices also went up rapidly in the market at least twice in the same period.
Prices of the root vegetable, a staple in sub-continental cuisine, went through the roof in 2019 after the impromptu export ban by India. The high prices had forced people to pay as much as Tk 260 per kilogram at times.
This put huge pressure on the government to devise ways to meet the domestic demand with local production. And it is working properly, boosting production, but import dependency is yet to subside.
The whys and hows
Talking to The Business Post, Habibur Rahaman Chowdhury, the director (routine charge) of the Department of Agricultural Extension’s (DAE) Field Service Wing, said, “We are on the right track to becoming self-sufficient because we have increased the production a lot in the last three years.”
“Our effort to boost production further in coming years will continue,” he added.
However, agriculture expert and former agriculture secretary Anwar Faruk said the annual production data collection process is not reliable. “Every year, field officers send the data showing more production than the previous year. This process must be scientific and authentic.”
The rise in imports despite increased production does not support the production data disseminated by the authorities. However, experts say this can be clarified by discussing some economic conditions and issues.
“Onion price was high in FY21, which led farmers to add more land for cultivation. Farmers also received government support to boost production. Due to this, both production and acreage increased in FY22,” said Dr Khondaker Golam Moazzem, the research director at the Centre for Policy Dialogue.
He said, “The supply chain was disrupted, despite increased production, due to the floods. That pushed up onion prices in Bangladesh’s market. At the same time, the prices in India were low.
“All these reasons made the importers more interested in importing Indian onions, which raised the overall import volume.”
Faruk said import dependency can be brought down to zero if the government provides more support to the 3-3.5 lakh onion farmers across the country. “It should also restrict import during off-season for the farmers’ benefit.”
Production, import since FY2018-19
The country had produced 23.305 lakh tonnes of onions and imported 10.07 lakh tonnes in FY2018-19.
In FY2019-20, production increased by around 51,000 tonnes to 23.81 lakh tonnes while imports dropped to 5.71 lakh tonnes, showing a nearly 50 per cent drop. In FY2020-21, production went up again to 33.62 lakh tonnes — thanks to the government’s initiatives and the highest ever price recorded in FY19 — and its impact took down imports to 5.53 lakh tonnes.
But in FY22, production broke all previous records and reached 35.04 lakh tonnes but imports also increased to 6.65 lakh tonnes, which took the total supply amount to 41.69 lakh tonnes.
The country’s annual demand is 24 lakh tonnes. According to the Commerce Ministry, a maximum of 30 per cent or 12.50 lakh tonnes of onion go to waste. Discarding that amount, the eatable onion volume remains 29.19 lakh tonnes and that is much higher than the annual demand.
Despite that, in December 2021, the local onion price had risen to Tk 75-80 per kg while the price of Indian onion went up to Tk 50-60 per kg.
In May this year, onion was sold at Tk 40-45 per kg in retail markets. Local varieties were sold at Tk 45 per kg while Indian varieties cost Tk 40.
