The government has set the logical price of certain agricultural products at the production, wholesale and retail levels to ensure the highest rate of profit for farmers.
As part of the Agriculture Marketing Policy-2021, released this month, the Agriculture Marketing Directorate (DAM) set a separate profit rate for farmers, wholesalers and retailers, DAM sources said.
According to the policy, farmers who produce paddy, rice, wheat, maize and other food grains can price their products by adding 30% to the cost of production while wholesalers can make 15% and retailers 25%.
The rate of profit was also fixed for various other agricultural products, including jute, tea, cotton, tobacco, lentils, all kinds of fish (fresh, dried and frozen), eggs, milk, juices , pickles and fries.
For fruit, DAM retains the option of 30% profit at the farmer and retail level and 20% profit at the wholesale level.
In addition, producers are allowed to make the highest 40% profit by selling onion, garlic, ginger, turmeric, chili, potatoes, vegetables and flowers.
However, agronomist Dr Mohammad Jahangir Alam Khan is a little skeptical about whether farmers or producers will benefit much from the fixed price rate of the Agriculture Marketing Directorate.
“This will obviously have a positive effect on the market. But, there is little chance that the farmer will get the logical price set by DAM,” he said.
To achieve its advantage at the farmer level, the government must create a structure to balance demand and production, he suggested.
Those involved in market surveillance said the onion, potato and rice markets have experienced the greatest instability in recent years. It is easy to monitor the market if the logical price rate is determined.
Deputy Director (Dhaka Division) of the National Consumer Rights Protection Directorate (DNCRP), Manjur Mohammad Shahriar, told TBS that while prices are set at the level of the producer, wholesaler and retailer, traders will not dare to increase the prices of any product.
The DNCRP monitors the prices of raw materials on the markets throughout the year. The organization carries out monitoring activities in the field of commodity prices taking into account the directives of the Ministry of Commerce and the DAM.
Those affected claim that farmers often have to sell for less than the cost of production while still growing crops at risk.
The agricultural marketing policy makes it compulsory to display the wholesale and retail prices of agricultural products and agricultural inputs in open places and to keep the original receipt of the product purchased in the commercial establishment. Supermarkets should provide all information regarding their establishment to the local DAM office.
According to the policy, wholesalers and retailers must obtain a license to market agricultural products in the designated market.
The policy calls for the formation of a national agricultural marketing coordination committee to implement it across the country. The 24-member body – with the Minister of Agriculture as adviser and the Secretary of Agriculture as chair – will meet at least once a year to discuss the overall situation.
This policy was formulated under section 28 of the Agricultural Marketing Law of 2018, sources said.