From bakeries to fish feed: Diversified wheat demand drives record imports

Highlights:

• Bangladesh records highest-ever wheat imports before fiscal year ends
• Rising bakery, processed foods, and fish feed drive demand
• Lower global wheat prices encouraged bulk private sector imports
• Changing diets shift consumption from rice to wheat products
• Domestic production insufficient to meet total wheat demand
• Some experts say imports exceed actual market demand

Bangladesh has surpassed all previous records for wheat imports with nearly three months of the financial year still remaining, driven by growing demand from bakeries, processed food manufacturers, and fish feed producers, combined with lower global prices.

Officials at the food ministry say another 10-15 lakh tonnes of wheat could be imported in the remaining period of the 2025-26 fiscal year.

According to ministry data, 5.83 lakh tonnes of wheat were imported by the government and 61.6 lakh tonnes by the private sector during the first nine months of the fiscal year, totalling the figure to 67.43 lakh tonnes. In FY25, total wheat imports stood at 62.35 lakh tonnes.

Speaking to The Business Standard, industry insiders say wheat demand has risen sharply because of changing food habits and greater use of wheat in bakery products, processed foods and fish feed. Lower prices in the international market have also encouraged companies to buy more than their immediate requirements.

Infograph: TBS

Md Moniruzzaman, director of procurement at the Directorate General of Food, said changing food habits had increased wheat demand in recent years. "This year, wheat imports have reached the highest level in the country's history."

Bangladesh's annual wheat requirement is estimated at 70-80 lakh tonnes. In addition to imports, the country produces around 10-12 lakh tonnes of wheat domestically each year. The Department of Agricultural Extension forecasts local wheat production at 11.14 lakh tonnes in the current fiscal year, up from 10.41 lakh tonnes a year earlier.

The pace of imports has accelerated significantly in recent months. Bangladesh imported 35.35 lakh tonnes of wheat in the first six months of the fiscal year, while another 32.08 lakh tonnes arrived between January and 8 April alone.

Sector insiders say wheat prices surged to record levels in 2022 following the Russia-Ukraine war, but fell to nearly half by the middle of last year and have since remained relatively stable. The lower prices have prompted private companies to increase purchases.

Private sector representatives say demand for bakery products has grown steadily as consumer preferences shift. A decade ago, only a handful of industrial groups marketed processed food products, but now the number is rising continuously. Alongside small bakeries, major industrial groups are making substantial investments in the sector.

Demand has also increased for eateries, restaurants and street food stalls. Wheat is now widely used in the production of noodles, biscuits, bread, chanachur, snacks, dried foods and frozen foods for both the domestic and export markets.

Pran-RFL Group, one of the country's largest food producers, now requires around 2.5 lakh tonnes of wheat a year for its food processing operations, up from about 1.8 lakh tonnes two to three years ago.

Kamruzzaman Kamal, marketing director at Pran-RFL Group, said the processed food market is expanding rapidly and becoming more diversified.

"Demand for wheat-based food products is rising among consumers. These products are being sold not only in the domestic market but also exported abroad," he said.

Echoing Kamal, Taslim Shahriar, deputy general manager of Meghna Group of Industries, said wheat imports have increased because of greater dietary diversity and stronger consumer demand.

Similar views were shared by FH Ansarey, managing director of ACI Agrolink Ltd. Consumers are showing more interest in wheat-based foods than rice because of growing health awareness, he said.

Changing food habits

Although there is no official estimate of the size of the bakery market, industry representatives believe it is worth around Tk15,000 crore. There are around 7,000 manual and live bakeries across the country, employing nearly 10 lakh people. Almost 1,000 bakeries operate in the capital alone.

Corporate investment in the bakery industry has also increased markedly over the past few years, contributing to greater use of wheat.

Md Rezaul Haque Rezu, general secretary of the Bangladesh Bread, Biscuit and Confectionery Manufacturers Association and owner of Haque Bakery, said the industry had suffered first during the pandemic and later because of the Russia-Ukraine war, when many bakeries closed as most wheat imports came from Ukraine.

"Over the last one to one-and-a-half years, the bakery sector has recovered significantly," he said.

"The industry is becoming more diversified and demand is increasing. Many people are eating less rice because of diabetes, while younger consumers are more interested in bakery products. Overall wheat consumption in the country is rising."

Data from the Bangladesh Bureau of Statistics show that changing food habits are contributing to the shift towards wheat. According to the Household Income and Expenditure Survey published in 2023, per capita daily consumption of wheat-based foods rose from 19.8 grams in 2016 to 22.9 grams in 2022, an increase of 15.65%.

Among urban consumers, wheat consumption increased by nearly 26% over the same period, while per capita rice consumption fell by 10.43%.

Rising rice prices and falling wheat prices have also encouraged consumers to switch. Three years ago, loose flour cost Tk8-9 more per kg than coarse rice. Now flour is around Tk15 cheaper.

According to the Trading Corporation of Bangladesh, coarse rice currently sells for Tk55-60 per kg, while loose flour costs Tk40-45. In 2023, coarse rice was priced at Tk46-50 per kg, compared with Tk55-58 for flour.

Rising demand in feed industry

Demand for wheat has also increased in the feed industry. Wheat bran is used in animal feed, while wheat itself is widely used in fish feed.

Md Anwarul Haque, general secretary of the Feed Industries Association Bangladesh and managing director of Padma Feed and Chicks Ltd, said fish feed typically contains 18-22% wheat.

"Commercial fish farming is expanding, so demand for feed is also rising. Floating feed is widely used in fish farming, which has increased wheat use in this sector more than ever before," he said.

He added that wheat bran was also used extensively in livestock feed.

Different thoughts

However, not all importers believe the rise reflects a structural increase in demand. Md Shafiul Athar Taslim, director of TK Group, said there is a large market for wheat-based products but argued that imports this year have exceeded actual demand.

"It cannot be said that demand has increased significantly. More wheat has been imported this year than is required. In some years imports are lower, in others they are higher," he said.