'Govt steps to curb potato price to leave little impact'

The government's measures to reign in potato prices may be beneficial in the short-run, but it will not leave any lasting impact on the market, according to Mostafa Azad Chowdhury Babu, president of the Bangladesh Cold Storage Association.

"It is right that the government allowed potato imports. This is because if supply increases, then the price will come down," he said in an interview with The Daily Star.

However, Babu claimed that even though buyers are willing to pay up to Tk 40 per kilogramme (kg) for potatoes in cold storage, the government is forcing farmers and traders to sell the crop at Tk 27.

"So, many famers and traders have stopped selling their potatoes," he said, adding that restricting product prices in this manner goes against the country's ideals as a free market economy.

Babu also informed that a representative of the local deputy commissioner's office is now always present at each cold storage following the government's directive to monitor sales.

On October 31, the commerce ministry directed district administrations to ensure that potatoes kept in cold storage are sold at a government-fixed rate of Tk 27 per kg from November 1.

The directive came a day after the commerce ministry, for the first time, allowed potato imports in face of spiralling prices in the domestic market.

Babu said that amid this situation, many farmers and traders could become discouraged from storing potato in cold storage in the future.

In a letter to the deputy commissioners of potato growing districts, the commerce ministry had mentioned that traders were selling the tuber crop at a higher price than the government rate.

On September 14, the government fixed the price of potato in cold storage at Tk 27 per kg while the retail price was set at Tk 36 per kg.

However, potatoes sold for Tk 55-60 per kg at different kitchen markets in Dhaka yesterday, up from Tk 52-55 a week ago, according to the state-run Trading Corporation of Bangladesh (TCB).

Meanwhile, the price has increased 25 percent over the past month and 109.03 percent year-on-year, TCB data shows.

Abu Jafor Ripon, the deputy commissioner of Munshiganj, inaugurated potato sales at the government rate of Tk 36 per kg on Thursday, when some 7,200 kgs of the crop were sold in upazilas of the district.

Babu also alleged that officials of the Department of Agricultural Extension overstate the production volume every year in order to please the government.

"But if the information given about potato production was correct, there would not have been such instability in the market," he said.

"To keep the market stable, the highest and lowest price of potato should be announced at the farmer's level at the beginning of the season every year," Babu added.