Food insecurity surges as inflation outpaces wage growth

Staff Reporter :

Food insecurity in Bangladesh surged by seven million people, reaching 23.6 million in December last year, compared to 16.5 million during the April – October period of 2024, according to a January report by the Food and Agriculture Organization of the United Nations (FAO).

The report also revealed that one in every seven Bangladeshis is experiencing acute food insecurity, a rise from one in ten three months ago.

Bangladesh faced recurring floods last year, along with Cyclone Remal, which affected an estimated 19 million people and caused significant damage to crops, livestock, food stocks, and agricultural infrastructure.

Despite above-average cereal harvests in 2023 and 2024, which improved food availability, the report highlights ongoing concerns about food access due to persistently high food inflation, which has reduced the purchasing power of vulnerable households.

Food inflation has remained elevated since August 2022, reaching an estimated 12.7 percent in October 2024. Rising production and transport costs, reduced cereal imports – particularly wheat-and the substantial depreciation of the Taka have all contributed to increased food prices.

According to the Bangladesh Bureau of Statistics (BBS), in FY24, worker wage growth was 7.74 percent, whereas the Consumer Price Index (CPI), commonly referred to as overall inflation, rose by 9.73 percent. Similarly, in FY23, the CPI surged to 9.02 percent.

As a result, many people have been forced to consume less food and reduce their overall cost of living by cutting down on expenses.

Wage growth for the working class has remained below the overall inflation rate for the past 34 months, since February 2022, indicating that workers are struggling to cope with rising financial pressures.

In its latest country brief on Bangladesh, the Global Information and Early Warning System on Food and Agriculture (GIEWS) warned that the country may face difficulties in meeting an estimated 8.3 million tonnes of food import requirements this year due to low foreign currency reserves and a weak national currency.

The FAO report projected that Bangladesh would need to import 8.3 million tonnes of cereals – including 0.45 million tonnes of rice, 6.1 million tonnes of wheat, and 2.1 million tonnes of maize – to offset domestic shortfalls.