Government Price Fixing Leads to Further Potato Price Increase
Because low-income individuals cannot afford the expensive potato Price, the government recently set a fixed potato price. Additionally, the market has taken measures to regulate prices. However, despite these efforts, the price of potatoes continues to rise instead of decreasing.
Potatoes were being sold for Tk 42 to Tk 45 per kg in various markets in Dhaka. On September 14, the government set the price at Tk 35 to Tk 36 per kg in retail markets. However, instead of decreasing, the price has been increasing daily since then. Currently, potatoes are being sold for Tk 43 to Tk 50 per kg at retail stores.
Yesterday, the potato Price reached its highest point since October 2020, selling at Tk 45 to Tk 50 per kg, as reported by the state-owned Trading Corporation of Bangladesh (TCB). Wholesalers and retailers argue that it is impossible to lower the price of potatoes without increasing the supply.
Mohammad Sabur, a wholesaler at Karwan Bazar, stated that prices cannot be lowered in this manner. He mentioned that he is only receiving half of the potatoes he needs. Sabur added that this is one of the main causes of the rise in market prices.
Humayun Kabir, a shopkeeper in the Paschim Tejturi Bazar area of Farmgate in the city, mentioned that the cost of a 65 kg bag of potatoes was Tk 2,900 last week, but it increased to Tk 3,000 yesterday. Currently, he is selling potatoes at a price range of Tk 46–50 per kg.
He said, ‘The wholesale potato Price is going up, so I have no choice but to raise the price. However, it’s unlikely that the price of potatoes will decrease anytime soon.’ Meanwhile, since the government announced the fixed price, the sale of potatoes has almost completely stopped in different cold storages in the Munshiganj district, which is responsible for supplying almost one-third of the potatoes.
Abdul Malek, the manager of Tongibari Cold Storage in East Muktarpur, Munshiganj, mentioned that no traders have brought potatoes to their facility in the last two days. He speculated that this could be due to either difficulties in selling potatoes or a lack of interest from the traders.
The head of the Bangladesh Cold Storage Association, Mostafa Azad Chowdhury, said that on September 13, potatoes were being sold for 36 to 37 taka per kg from cold storage. Three days later, the National Consumer Rights Protection Directorate told traders to sell potatoes for Tk 26 to Tk 27 per kg starting September 17.
Traders are afraid of suffering significant losses if they sell potatoes at the prices set by the Consumer Affairs Department, according to Mustafa Azad Chowdhury. As a result, many traders have decided to halt the sale of potatoes and are closely observing the situation.
Golam Rahman, President of the Consumers Association of Bangladesh, stated that potato Price control is not compatible with the idea of a free market economy. He suggested that the government should establish a proper supply chain, which would help resolve various issues and ultimately benefit consumers.
He believes that when the government intervenes in the market and imposes fines on traders, it leads to higher potato Price for products.