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The Financial Express

Taming the volatile kitchen market  

| Updated: October 27, 2020 20:18:56


Lankabangla and Fianancial Express Lankabangla and Fianancial Express
Taming the volatile kitchen market   

To the people in the low and middle income brackets what matter most in their daily lives are the prices of kitchen market items. These we popularly term 'daily essentials', or simply, 'essentials'. Prices of these essentials including rice, vegetables, edible oil, fish and meat are what they have to first encounter in the morning before the main bread earner starts her/his daily work. Unfortunately, their encounter with kitchen market has never been a pleasant one. The government, intellectuals, rights campaigners and experts have never stopped worrying about the punishing impacts of the forever-volatile essentials' prices on the lives of the common people. But the kitchen market never responds to such concerns. But it does respond very quickly to any speculation as soon as it comes in handy.

 In the past, when political parties called general strikes to enforce their anti-government programmes, prices of essentials would soar. If there is a forecast about an impending flood, the kitchen markets get edgy. Whenever there is a government announcement of a pay-raise of its employees, the essentials' market will in no time react by hiking up prices of rice, flour, egg, fish and vegetables! You don't need any logic to increase the prices. If, as economists would like to attribute changes in commodity prices to the market forces of demand and supply, then how on earth does the gossip about, say, an increase in the wages of garment workers immediately impacts the essentials' prices at the grocery on the roadside frequented by these workers? How does the law of demand and supply come into play here?

In every other society before and during major religious festivals, one sees price reductions. Our wholesalers and retailers, on the other hand, usually welcome these events by increasing commodity prices. And the way the prices of foodstuffs such as onion, lentil, aubergine, cucumber, edible oil, flouretc, the basic ingredients of iftar items including piazu, beguni, jelapi shoot up before and during the holy month of Ramadan, says a lot about our trading peoples' priorities! Worse still, how can you reconcile with the practice of rampant food adulteration during the holy month?

What we are faced with here is perhaps a market that is too distorted to follow any law due to the dominance of the non-market forces. So, when there is no apparent shortage of rice in the market, its price suddenly goes up without rhyme or reason. Why has potato price shot up from Tk 25 to Tk. 50 per kg? The government has intervened, set the retail price of potato at Tk 35 per kg, wholesale price at Tk30 and Tk 27 per kg at the cold storage level. But at the retailers' level, the prices of potato are still between Tk 40 and 45. In fact, at the common consumers' level, the government-fixed rates hardly ever work.

Market watchers say potato growing has been delayed due to incessant rain.  Anticipating shortfall before the next harvest, some businessmen have been hoarding potato in cold storages. They are thereby controlling supply of the item to the wholesalers. So the potato market is so volatile.  Clearly, hoarders are distorting the market. Here the only way to restore normalcy in the market is through government intervention. And as hoarding is illegal, the government needs also to take action against hoarders as the law dictates.

As the reports go, supply of rice is also being controlled by millers. Green vegetables prices, on the other hand, have always been going through the roof. Guess, if you have not visited the kitchen market during these pandemic-stricken months, what may be the price of green chilli? It is selling, as this paper reported in its Saturday (October 24) issue, between Tk 220 and 250 per kg! Tomato or aubergine, or bitter gourd, just to mention a few, have either crossed Tk 100 mark or are waiting for the opportune moment!

Essentials' prices always make a big dent in the common people's earnings. There must be some ways to tame the kitchen market.

 

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