Auction markets transforming fish trade as farmers bypass middlemen: BIDS study

Large volumes of fish are now moving from southern Bangladesh to markets across the country with fewer intermediaries, as farmers increasingly opt to sell directly through auction-based systems rather than rely on village-level middlemen, according to a new study presented at the Bangladesh Institute of Development Studies (BIDS) Annual Conference on Development 2025.

The findings, shared on the second day of the conference at Parjatan Bhaban in Agargaon, come from a 2020 survey that revisited fish wholesalers, retailers and farms in seven districts previously studied in 2013. The research, titled "Wholesalers and the Transformation of the 'Hidden Middle' of the Aquaculture Value Chain in Bangladesh", was presented by Ben Belton, research fellow at International Food Policy Research Institute (IFPRI), who conducted the study with colleagues from WorldFish, Bangladesh Agricultural University and Michigan State University.

Belton said farmers are increasingly drawn to auction markets because transparent bidding ensures they receive the highest available prices. The growing number of traders in these markets has strengthened competition, making direct sales more attractive than dealing with traditional intermediaries. As a result, 89% of farmers now sell directly through auction markets, while only 7% continue to sell to faria, village assemblers who historically dominated the fish trade.

The study found that the once-common practice of dadon, credit provided by traders to secure future sales, has reduced significantly. Where it still exists, it is used mostly to secure access to shrimp rather than extract additional surplus from farmers.

Wholesalers, meanwhile, have undergone rapid modernisation. Mobile phone ownership increased from 74% in 2013 to 97% in 2020, while the use of plastic crates and barrels has become nearly universal. The proportion of wholesalers storing fish on ice rose from 28% to 63%, and across all categories, 74-100% now use loose ice. Belton noted that icing and packaging constitute 22-28% of wholesalers' operating costs.

Improvements in transport, communication, access to ice and better packaging have also dramatically reduced loss and waste along the supply chain. The sale of live fish has grown sharply, now accounting for 25% of total sales compared to 5-10% a decade earlier. Procurement of live fish and shrimp rose to 40% in 2020.

Belton added that Bangladesh's aquaculture sector has expanded rapidly over the past 30 years, with farmed aquatic food supply increasing fourfold since 2000. The sector remains a major source of employment for men and youth, though women's participation continues to lag.

The session was chaired by Geoff Wood, professor emeritus at the University of Bath. It also featured papers from IFPRI research fellows Moogdho Mahzab and Mehrab Bakhtiar on mechanised harvesting and the long-term impacts of social assistance.