DHAKA (Reuters) - Bangladesh is expecting a bumper summer harvest of rice in just a month that will help contain soaring prices due to short supply and an abnormal spike in the export rate by India, government officials said on Sunday.
Food prices, including of rice -- the main staple for Bangladesh's more than 140 million people -- have risen nearly 60 percent in the past six months, retailers and consumers said.
But the domestic market faced further volatility after India, which promised to supply 500,000 tonnes of rice to Bangladesh under a government-to-government deal late last year, on Friday refixed the export price per tonne at $1,000, up from $650 earlier.
Though it was unclear if the new rate would apply to the above deal, traders believed the Indian move was intended to halt exports of rice to leave enough in stock for its own people, as rice production dropped across the world this year.
But a senior food ministry official in Dhaka told reporters that the higher Indian export rate was not a concern for Bangladesh, which expects to have a bumper harvest of its major Boro variety of rice in April-May.
"Also, we have enough stock of rice to last until the Boro is home," acting food secretary Molla Waheduzzaman said, without giving any figure.
Market sources said prices of rice, wheat, pulses, edible oil and all other consumables continued to rise steadily despite government assurances.
A kilogram of rice now sells between 35 and 45 taka ($0.51-$0.66) in Dhaka's retail markets, but at 10 taka less at shops run by Bangladesh Rifles (BDR) paramilitary troops.
Hundreds of troop-run shops were introduced last year to try to help low-income people, with queues growing longer every day.
Now, officials and soldiers say, many middle-income citizens also join the queues and wait for hours to grab a few kilos of rice and other goods.
"Life is becoming more miserable every day," said a woman waiting for her turn at a BDR shop at the capital's Banani area.
"We burn under scorching sun for several hours but often go back empty handed, as supplies run out," she said.
Waheduzzaman said more such shops would operate soon in Dhaka and other main cities while the government was also planning to sell rice from moving trucks at subsidised rates.
Agriculture ministry officials said the coming Boro rice production was expected to be more than 17.5 million tonnes "if weather and other things go well". Bangladesh produces around 30 million tonnes of rice annually, nearly enough to feed its population.
But the country faced food shortages after two floods and a cyclone destroyed nearly 2 million tonnes of rice last year.
The government says it has since imported 2.9 million tonnes of rice and is trying to bring in more to offset the loss and build an emergency stock for the 2007-08 (July-June) fiscal year.
But the export ban by some countries and price hikes by others have put the impoverished South Asian country into difficulty, officials and traders said.
Bangladesh's army-backed interim government has been criticised by economists and civil society for delayed action on grain imports that was to largely blame for the crisis.
The government, headed by former central bank governor Fakhruddin Ahmed, said the country was in no danger of famine and that no one would die of starvation. ($1 = 68.58 taka)
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