Supply shortages behind high food prices: CPD

Supply shortages, trader collusion and hoarding are among the major factors driving high food prices in Bangladesh, according to a study by the Centre for Policy Dialogue (CPD).

The independent think tank revealed the findings of its food price chain study at a dialogue held at the BRAC Centre Inn in Dhaka on Thursday.

The study examined the supply chains of 10 essential commodities, including rice, lentils, onions, potatoes, green chilli, brinjal, eggs, beef, rui fish and chicken, to identify how prices rise from producers to consumers.

CPD said its research team collected data from 10 retail markets in Dhaka Division and surveyed 500 retailers to analyse pricing patterns.

The study found that farmers, millers, urban wholesalers and retailers captured the largest share of consumer spending through gross margins in many cases.

CPD Senior Research Associate Foqoruddin Al Kabir said the price gap at the producer level was significant, exceeding 50 percent for onions and fish and crossing 100 percent for potatoes, brinjal and green chilli.

The study also found that prices of brinjal and green chilli fluctuated significantly across market levels, while chicken and beef farmers faced negative net margins mainly due to high feed costs.

According to the report, commission-based transactions were common in markets for onions, brinjal, green chilli, fish and beef. Retailers’ dependence on urban aratdars (commission agents) contributed to market concentration and increased price volatility.

CPD recommended reducing unnecessary layers in the supply chain, increasing market competition, and strengthening monitoring by the Ministry of Commerce and the Competition Commission.

It also called for expanding market options for farmers and retailers and improving transparency in price and market information.

CPD Executive Director Fahmida Khatun said food price inflation remains one of Bangladesh’s biggest economic challenges, particularly affecting low-income households.

She identified production constraints, inefficient supply chains and weak competition as key reasons behind persistent price pressures and called for stronger monitoring and evidence-based reforms.

Commerce Minister Khandakar Abdul Muktadir and Consumers Association of Bangladesh (CAB) President AHM Shafiquzzaman, among others, attended the dialogue.