The Rice Market in Bangladesh to Rise Modestly

IndexBox has just published a new report "Bangladesh: Rice - Market Report. Analysis And Forecast To 2025". Here is a summary of the report’s key findings.

The Consumption of Rice in Bangladesh Remains Stable

In wholesale prices, the Bangladesh rice market earned total revenues of $8.5B in 2016, which was significantly lower than the highest level of consumption achieved in 2014. This figure reflects the total revenue of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). According to IndexBox estimates, in 2015 the market contracted by -7%, stabilizing over the next year. 

In physical terms, Bangladesh rice consumption decreased by -1% in 2016, amounting to 36.9M tonnes (this figure was calculated in terms of milled rice weight). As rice remains a key staple food in the Asian diet, the volume of consumption remained relatively stable, with only mild fluctuations over the period under review.

Rice Consumption Is Expected to Exceed 41.6M Tonnes by the End of 2025

Rice constitutes a traditional product staple in the daily diet of the local population, therefore any significant changes in the current rice consumption trend are not projected. Driven by Bangladesh population growth, government agricultural programs, state subsidies, the application of water and other resource management technologies, and the mechanization of rice cultivation, the rice market as a whole is expected to continue an upward production and consumption trend over the next nine years. Market performance is forecast to rise modestly but steadily, with an anticipated CAGR of +1.3% for the nine-year period from 2016 to 2025, which is expected to lead the market to a volume of 41.6M tonnes by the end of 2025.

The Rice Production Volume Remained Stable

Rice production in Bangladesh remained stable, at 52.6M tonnes of paddy rice in 2016. There was a steady growth with an annual average rate of growth of +2.2% from 2007 to 2016. The production value in 2016 increased to $12.1B USD after falling by 5% in 2015 due to a reduction in producer prices. This figure was $524M (or -4%) less than the peak level observed in 2013.

The Bangladesh Rice Market Is Almost Entirely Buoyed by Domestic Production

The Bangladesh rice market is almost fully supplied by the country’s own domestic production. The share of imports in consumption did not exceed 5% in physical terms over the period under review. In addition, in 2016, the share of imports in consumption was 0.1% in physical terms.

In value terms, the share of imports increased significantly in certain years, but in 2016 did not exceed 0.2%. Despite import growth being observed in certain years, imported rice accounts for a very small share of the market, in comparison with domestic products.

The U.S., the Maldives and Italy Were the Main Export Destinations for Bangladesh Rice

Bangladesh exported 6K tonnes of rice in 2016, which accounted for 0.02% of Bangladesh rice cultivation. Thus, Bangladesh rice exports remained negligible over the period under review. 

In 2016, the main destinations for Bangladesh rice exports were the U.S. (23%), the Maldives (22%) and Italy (22%). The U.S. had the highest annual average rate of growth in terms of imports (+13.3%) amongst the leaders from 2007 to 2016. The share exported to the U.S. (+17 percentage points) increased, while the share sent to Italy decreased. significantly (-39 percentage points). 

India Was the Main Supplier of Rice into Bangladesh

The volume of rice imports into Bangladesh remained relatively insignificant: Bangladesh boasts a stable volume of rice production that is sufficient to satisfy domestic consumption. The volume of Bangladesh rice imports totaled 30K tonnes in 2016, with a period of wild fluctuation from 2007 to 2016. In 2016, India (89%, based on tonnes), was the main supplier of rice into Bangladesh. From 2007 to 2016, rice imports from India decreased by -35.9% per year. This can be explained by the fact that the Bangladesh government imposed a tariff on rice imports from India in an effort to protect local farmers. 

Do you want to know more about the rice in Bangladesh? Get the latest trends and insight from our report. It includes a wide range of statistics on

• rice market share
• rice prices
• rice industry
• rice sales
• rice import
• rice export
• rice market forecast
• rice price forecast

Source: Bangladesh: Rice - Market Report. Analysis And Forecast To 2025