Friday, February 04, 2011

Bangladesh to make immediate purchases of grain

Bangladesh is taking steps to purchase more food to prevent future shortages. They are going to buy grain at a faster rate than ever before prices increase any more. The Bangladeshi government hopes that this will prevent unrest in the streets and provide food even during times of crisis.

From Reuters Alert Net, writer Ruma Paul describes the new purchases of grain.

"We are thinking to raise the volume of grains in tenders," an official at the Directorate General of Food, who declined to be named, said on Friday.

The government is under increasing pressure to contain prices. Analysts say Bangladesh faces unrest if prices continue to rise, given that nearly 40 percent of its population survive on less than $1 a day.

"If possible, for wheat tenders we may ask for 100,000 tonnes instead of the earlier 50,000 tonnes. For parboiled rice we can seek 50,000 tonnes from an earlier 30,000 tonnes to cut time and build stocks as quickly as possible," the official told Reuters.

"If it is not possible, we will issue tenders for wheat and rice every week," he said.

U.S. wheat futures rallied to near 2.5-year highs on Friday as concerns mounted about yields from the U.S. winter wheat crop and boosted by stronger oil prices. [GRA/]

Soaring prices pushed Bangladesh's food inflation rate to 11.01 percent in December, the highest level in three years.

The government seeks to import 2.2-3.0 million tonnes of rice and wheat in the year to June, up from around 550,000 tonnes in the previous year.

Bangladesh, which suffered badly during the 2008 spike in global food prices, wants to build reserves of basic commodities such as wheat, rice, oils and sugar to avoid a similar situation..

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