The export of agricultural products, including vegetables, fruits and dry food, decreased 26.96 per cent in the first eight months of the current financial year, the sharpest decline in seven years, official figures showed.  

Agricultural products fetched $623.18 million in July-February of 2022-23, which was $853 million in the same eight-month period of 2021-22, according to data from the Export Promotion Bureau (EPB).

This was the sharpest decline in seven years. It rose 28.36 per cent in July-February of 2021-22.

The sharp export slowdown is threatening Bangladesh's increasing earnings from the selling of agricultural products in the external markets.

The shipment went past the $1-billion mark for the first time in 2020-21 when exporters fetched $1.03 billion. The momentum continued in the following fiscal year when the earnings rose to $1.16 billion, according to the EPB.

Exporters blame the higher raw material costs and buyers' reluctance to procure products from Bangladesh at the escalated prices for the decline.

Owing to higher cargo fares and freight costs, local exporters themselves are also showing a lack of interest in selling fresh farm produce in the overseas markets, they said.

Mohammad Shahadat Hossain, assistant general manager for exports at Kazi Food Industries Limited, said: "Due to the increase in the price of raw materials, buyers are not agreeing to the new price. Our prices are also much higher than in the competing countries. So, we are losing markets."

At the same time, the profit margin has also decreased, he claimed.

Firms exported frozen vegetables, fruits and processed foods to 12 countries, including Saudi Arabia, Italy, France, the United Kingdom and Ireland.

"Although the quality of our products is better than competitors', Bangladesh is lagging behind due to higher prices," Hossain added.

Mizanur Rahman, proprietor of Need Agro Foods Limited, said the cost of production had increased by 35 per cent. "When the new price is sent to buyers, they don't want to place orders. As a result, orders have decreased."

Need Agro Foods exports bakery products and spices to Qatar and Saudi Arabia.

Rahman said competitor countries such as India could sell products at prices that are lower than quoted by Bangladeshi companies. Even Pakistan is selling products at lower prices than Bangladesh.

Square Food and Beverage Ltd usually exports aromatic rice, spices, mustard oil and snacks to the Middle East, the United States, Canada and various European countries.

Rezaul Karim, assistant manager of the international marketing department of the company, said the government has stopped the export of aromatic rice since July 2022 to keep the local rice market stable.

"So, we can't export aromatic rice now. This has a negative impact on our overall exports."

Rice accounts for about 30 per cent of the export value of Square Food and Beverage.

Debasish Singha, head of business at Danish Biscuit, owned by Partex Star Group, said the company's goods exports fell by nearly 20 per cent in July-February due to rising prices and the ongoing global economic slowdown.

It ships products to 54 countries.

A top official of an export-oriented company, said some exporters used to show higher receipts in their documents in order to reap more benefits from the government's incentives.

"After the issue came to the notice of the government, the misuse has reduced. This could be one of the main factors for the decline in exports," he said.

The government provides a 20 per cent incentive for the export of agricultural products.

SM Jahangir Hossain, president of the Bangladesh Fruits, Vegetables and Allied Products Exporters' Association, said freight costs have gone up. So, importers, mainly in the Middle East, are showing a lack of interest to buy fresh farm produce from Bangladesh.

"In the last six months, airlines have hiked cargo fares at will," he said, adding that the air freight cost has shot up 40 per cent over the last one year.