Aman paddy prices fall, farmers trapped in cycle of loss

As the boro harvesting season begins across Bangladesh's haors, a quiet crisis is unfolding in the country's grain markets.

Farmers, who celebrated record Aman harvests a few months ago, are now watching prices collapse – pushing them into a tightening cycle of losses.

In the low-lying haor regions, paddy cutting is already underway. Within weeks, the northern districts will follow. But for many farmers, the timing could not be worse. Over the past month, the price of stored Aman paddy has fallen sharply – an unusual trend for the end of the season.

Compared to last year, farmers say prices per maund have dropped by Tk250 to Tk500 depending on quality. In some cases, the fall has been even steeper.

Infograph: TBS

In Naogaon's Manda upazila, one of the country's major grain hubs, farmers gather at rural markets with uneasy expectations. At Satihaat this week, Swarna-5 paddy sold for Tk1,100 to Tk1,120 per maund, down from Tk1,490 to Tk1,540 a year earlier. Jirashail, once fetching over Tk2,000, is now trading between Tk1,390 and Tk1,440. Even premium varieties like Shampa Katar have seen notable declines.

"I've never seen prices fall like this in the month of Chaitra," said Golam Mostafa, a farmer from Bhimpur village with two decades of experience. Last year, he sold old paddy for Tk1,600-Tk1,700 per maund.

This year, buyers are offering barely Tk1,000, forcing many farmers to return home with unsold grain, he claimed.

According to the Department of Agricultural Extension, Aman production reached a record 18.1 million tonnes last season. At the same time, rice imports surged. Government data shows that Bangladesh imported 1.436 million tonnes of rice in the last fiscal year – the highest in seven years – and another 1.119 million tonnes have already been imported this fiscal year.

Mills, imports, market scenario

Rice mill owners acknowledge the slowdown but point to the same underlying issue: excess supply.

Dewan Md Tanbir, a member of the Bangladesh Auto Rice Mill Association, said mills still hold substantial stocks of Aman paddy. Production has been strong in recent seasons, and imports have added further pressure.

The situation has created a bottleneck – mills are hesitant to process paddy into rice because selling rice at current prices would result in losses. Consequently, procurement from farmers has slowed dramatically.

In Nilphamari's Kishoreganj upazila, farmer Tofayel Ahmed Swapan said prices have dropped by around Tk200 per maund in just a month. Mills have slowed purchases, and farmers are holding unsold stocks. Meanwhile, his upcoming boro harvest is expected to yield 450 maunds.

"Once boro arrives fully, we won't be able to sell Aman at all," he said.

Mozammel Haque, who brought Jirashail paddy to sell, found buyers offering Tk1,400 per maund – far below last year's Tk2,000 rate.

"If I had known, I would have sold earlier," he said. "Fertiliser, seeds, pesticides – everything costs more now. But no one is willing to pay a fair price for our crops."

Others are selling at a loss to recover some cash. Abdul Khaleq sold 30 maunds at Tk1,120 each but fears prices may fall below Tk1,000 soon. "We had a good harvest, yet imports have pushed us into losses," he said. "If this continues, I will stop growing paddy."

Even as farmers struggle to sell old stock, new harvests are entering the market at low prices. In haor areas, about 20% of boro paddy has already been harvested, selling at Tk700-Tk750 per maund – well below expectations.

Oversupply, impact

"Farmers and millers are both sitting on large stocks," Professor Mohammad Jahangir Alam, a faculty member of Bangladesh Agriculture University's agribusiness and marketing department, told The Business Standard.

"Imports are necessary, but decisions are often delayed. By the time shipments arrive, the crisis has already passed," he said.

Jahangir warned that falling prices may benefit consumers temporarily but they come at a high cost to producers. "With boro harvest entering the market, Aman prices have little chance of recovery. Farmers will inevitably face losses – and many will be trapped in a recurring loss cycle."

Even new paddy fails to offer relief

The outlook for boro farmers is equally grim.

Harvesting has already begun in the haor regions, where about 20% of the crop has been cut. Yet prices for freshly harvested paddy are also disappointing, hovering around Tk700-750 per maund.

For farmers like Dipro Chowdhury in Netrakona's Khaliajuri upazila, the math simply doesn't add up. "I sold at Tk700 per maund from the field," he said. "Normally it would be over Tk800. This year, flooding and continuous rain have increased costs, especially for irrigation and diesel."

He fears yields may also decline, further squeezing margins.

In Bogura's Dupchanchia area, farmer Maminul Islam cultivated 25 bighas of land this season. "New paddy is selling at Tk750–800 per maund," he said. "At this price, we can't even recover costs. It should be at least Tk1,200 for farmers to survive."

Rising costs of fertiliser and pesticides have deepened the crisis.

Another farmer, Toufiqul Islam, expressed his frustration bluntly: "If we continue farming potatoes, taro, and paddy like this, farmers will hang themselves with debt. Loans cannot be repaid. Within a year, many will be forced to sell their land."

A system under strain

Industry insiders warn that the crisis extends beyond farmers.

Farhad Hossain Chakdar, general secretary of a rice mill owners' group in Naogaon, criticised what he described as unregulated imports. "The government allowed traders to import rice freely without considering domestic production," he said. "Now both farmers and millers are paying the price."

He added that unsold stocks have piled up in mills, pushing rice prices down by Tk2-7 per kilogram over the past month.

"If the government does not significantly increase procurement in the upcoming boro season, the local rice milling industry could face collapse," he warned. "Business may shift to large corporations, and small farmers will reduce cultivation if they continue to receive unfair prices."

A senior marketing official in Bogura echoed similar concerns, pointing to cheaper imported rice – particularly from India – as a key factor behind the market collapse. With thousands of tonnes of unsold rice in storage, millers are reluctant to process more paddy, fearing further losses.