The Fluctuation in the price of rice market Presentation on The Fluctuation in the price of rice market

Food policy in Bangladesh has several objectives, though basically the major objective I ensuring food security for all households. In attempting to meet this objective, the Government of Bangladesh undertakes several activities, including open markets ales of food grain to limit food grain price increases, targeting food distribution to poor households, providing emergency relief after natural disasters, and procuring food grain to support producer prices and incomes. Government food policy has both price and quantity aspects, and given fiscal, as well as stock constraints, it is not always possible to meet all objectives.

Why rice is life or important in Bangladesh Rice is the most important staple food for a large part of the world's human population, especially in East and South Asia, the Middle East, Latin America, and the West Indies. It is the grain with the second-highest worldwide production, after maize(corn). Since a large portion of maize crops are grown for purposes other than human consumption, rice is the most important grain with regard to human nutrition and caloric intake, providing more than one fifth of the calories consumed worldwide by the human species.

Causes of theFluctuation of price rice Rice production increases must be achieved at a faster rate than in most other countries, while the land planted to rice is not expanding. In addition, Bangladesh is faced with production constraints such as drought, lack of irrigation facilities, flooding and salinity of soils, coupled with fluctuating commercial rice prices.

RICE PRICES IN BANGLADESH: ANNUAL AND SEASONAL PATTERNS   Annual price fluctuations in Bangladesh arise mostly from fluctuation in production, which again can be attributed to the random effect of floods and drought. Prior to 1994, public imports, and to a lesser extent drawdown of stocks, were the main policy instruments to achieve year-to-year stability in prices. As will be discussed below, since the trade liberalization of 1994, the private sector import trade has been the Dominant factor in keeping price rises within acceptable limits in case of a domestic production shortfall.

Impacts of government intervention rice price The alternative to making the investments required and permitting private sector export stubble producer prices following bumper harvests is, of course, government t procurement. It then reviews the government’s recent experience with domestic procurement and open market sales of rice, comparing government sales and purchases with market prices in recent years.

IMPACT OF DOMESTIC PROCUREMENT AND DISTRIBUTION ON MARKET PRICES Presents estimates of the effect of domestic net procurement on market prices. The impact of net procurement on domestic prices can be calculated by considering net procurement as a reduction in net market supply, and then using an assumed own-price elasticity of demand for rice.

SALES STRUCTURE OF FOODGRAIN PRODUCTION AND Presents estimates of rice and wheat production cultivated by farm size based on data from the 1996/97 Agricultural Census. Production by farm size is estimated using the Area cultivated data from the Agricultural Census and average yield data by season and type office cultivation from the Bangladesh Bureau of Statistics.

Market Price The market price is one of the prime considerations of public food management in Bangladesh. Price stabilization especially food grains price stabilization in the developing countries like Bangladesh is required to arrest instability arising from shocks in the domestic supply of food grains due to shortfall caused by natural calamities or ample supply of bumper production. The stabilization of price constitutes an important element to maintain production incentive to the growers and to provide consumers welfare.

Average Wholesale Price of Coarse Rice, Bangladesh

Nature and Extent of Rice Price Stabilization There are two types of temporal variation in prices: Inter-year (annual) and Intra-year (seasonal), Annual price fluctuations in Bangladesh arise mostly from Fluctuation in Production, which can be attributed to random effect of natural calamities like floods or drought.

Nature and Extent of Rice Price Stabilization (Cont.) The seasonal component is defined as the intra-year pattern of variation, which is repeated constantly or evolve from year to year. The increase in the size of the boor harvest relative to amen and auks is the major factor of seasonal price variation. Increase in the share of boor in the total production have eliminated the steep seasonal rise in prices in June and July observed in the late 1971s and resulted in relatively stable prices from May to October. As a result, the ratio of peak to trough has been reduced.

Strategies for Price Stabilization Price stabilization does not necessarily mean the fixation of food grain prices. It means to keep the fluctuations in market prices within reasonable limits. In Bangladesh following strategies and programs are used as a mechanism for stabilization of food grains prices. Public food grains distribution Domestic procurement of foodgrains Encouragement of private import of foodgrains.

Conclusion   Rice is very important because about 40% farmers in Bangladesh are producing rice. By which most people in Bangladesh regulate their living condition. Rice is the seed of the monocot plant Orzo sativa. As a cereal grain, it is the most important food for a large part of the world's human population, especially in East and South Asia, the Middle East, Latin America, and the West Indies. It is the grain with the second- highest worldwide production. Rice production increases must be achieved at a faster rate than in most other countries, while the land planted to rice is not expanding. But in our country there is some major factor which is affect on production of rice price.