Flood victims face rising food prices

For 23-year-old Rabeya, pregnant and now ready to give birth to her second child, the rice she holds in her hand may soon be out of reach.

“I can’t afford this,” she said, outside the simple tin hut she shares with her husband, Julhash, and their one year-old son, in Kalachadpur, a downtrodden flood-affected neighbourhood in the Bangladeshi capital, Dhaka.

“And if I can’t even buy rice, what am I supposed to feed my family?” she asked.

That is a good question and one increasingly being asked by victims of this year’s heavier than average monsoon rains in the country, where basic cereal prices over the last three weeks have risen by up to of 22 percent in some places.

In line with international commodity prices and rising fuel costs, food prices in Bangladesh are already prohibitively high. But the floods - some of the worst in recent years - have exacerbated the situation.

“This is a serious source of concern for us,” Douglas Broderick, country representative of the UN World Food Programme (WFP) told IRIN in Dhaka “Over the past few weeks food prices have really shot up.”

More than 10 million of the country’s 153 million people were affected and hundreds of people killed over the past month, after above average monsoon rains battered much of the low lying nation, leaving 39 of the country’s 64 districts, partially or fully inundated.

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Hundreds of thousands were left homeless, forcing over 300,000 to seek shelter in over 600 shelters in the country - a number steadily decreasing as the floods recede and more and more flood victims return home.

Satellite imagery shows that up to 40,000 of the country’s 147,000sqkm was affected this year. “This is a common occurrence in Bangladesh,” Broderick said.

What is new, however, is the significant effect on food prices - already high by Bangladeshi standards and still rising.

The local Daily Star newspaper on 22 August said the international price for the best quality rice had risen from US$260 per metric tonne [mt] in 2005 to $340 this year, while wheat had risen from $160 to $245 per mt over the same period of time.

That reality - coupled with the impact of this year’s floods - has made experts worried.

The UN’s Food and Agriculture Organisation said that this year’s floods in South Asia were a “serious cause for concern” due to the loss of animals and unfavourable crop prospects following damage to recently planted crops.

“Opportunities for replanting once the water has receded are limited as the sowing period of the main cereal season normally ends in July in India and Bangladesh and by mid-August in Nepal,” the agency said in a 17 August statement.

Inflation

At the same time, the World Bank, in a preliminary assessment entitled, Bangladesh Floods 2007: Preliminary Impact Assessment, said an already high inflation rate of 9.2 percent in June, could accelerate in the coming months.

“Rising food prices in particular is the biggest concern. The flood is making it worse,” the report said, warning, “Inflation could easily rise further in the next couple of months.”


Photo: David Swanson/IRIN
For 23-year-old Rabeya and her rickshaw driver husband Julhash, this year's floods have meant a sharp rise in the price of food essentials

“It’s really a double whammy… we haven’t seen this [flooding affecting food prices in combination with inflationary pressure] in a while,” Broderick said.”

Only recently, the average price of rice in Dhaka was between 0.25 to 0.28 US cents a kilo. Today it costs 40 cents or more.

In a country where rice is a critical determinant of household food security, that’s big news.

“People simply can’t afford this,” snapped 54-year-old Akramul Chowdhury, a retired school teacher in Dhaka, where rice in the city had increased by 4.5 percent and wheat prices by 17 over the past three weeks.

“If the government doesn’t do something soon, we’re going to see real problems,” warned Younus, a 19-year student at Dhaka University, where just last week riots against the country’s current interim government broke out, resulting in curfews in six different cities.

Government intervention

But the government has already taken a number of measures: In a bid to rein in potential price hikes during the upcoming holy month of Ramadan, the authorities will sell rice at 27 US cents per kilo through the country’s Open Market Sale (OMS) scheme.

Initiated whenever a potential food crisis is perceived in which prices can rise rapidly, a person can buy 3kgs of rice at a time from OMS outlets. To feed the OMS plan, the government will buy 118,000mt of rice at 29 US cents a kg and supply it to 15,000 dealers at 26 US cents, providing a three cents subsidy for each kg.

Of the government’s 683,000mt of rice and wheat reserves reported at the end of July, 15,000 has already been allocated or dispatched to the flood-affected areas.

Food prices in the flood-affected areas could still rise further, as suppliers struggle to get their products to market, with trucks which normally take three hours to make a delivery now taking 12, resulting in additional transport costs.

“It could be temporary,” Broderick said, but a lot of that will have to do with how much this year’s crops have been affected, citing the importance of the upcoming Aman rice harvest expected in about 100 days.

Initial estimates in the local media suggest that the country’s agricultural sector has suffered losses of between US$80 to $100 million.

WFP response

In response, WFP continues to monitor the number of people still living in shelters, as well as those who took refuge along river embankments and are likely to stay there until flood waters recede further.


Photo: David Swanson/IRIN
More than 10 million people were affected by this year's floods

Currently over one million people are receiving food assistance through WFP, the government and the non-governmental organisation community - a response that will likely need to be continued until the end of the year.

As part of that, WFP is providing food assistance to 822,000 people, comprised primarily of 20 kilos of rice per family.

“It’s happening right now. It’s ongoing,” Broderick said, noting the likely need to extend the programme for the next four months given the loss of livelihoods, crops and livestock in the flood-affected areas.

“What we’re trying to do is provide people with the food security they need; a safety net that will allow them to get back on their feet as soon as possible,” he explained.

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