The government is going to import one lakh tonnes of sugar to boost stocks and keep prices stable, said industries ministry officials.
Bidding for half of the planned imports has already been completed, they said.
The proposal to import the sugar will soon be placed with the cabinet committee on purchase for approval and the sugar will arrive by December.
AKM Delwer Hussain, chairman of Bangladesh Sugar and Food Industries Corporation, said the sugar import has been planned as overall production at state mills might stand at 80,000 tonnes rather than the targeted 1 lakh tonnes in the coming crushing season owing to damage to four mills in the north.
“We plan for imports so that none can increase prices at whim cashing in on inadequate public stocks,” he said.
Private refiners however argue that purchasing the sweetener from local sources instead of going for imports will save foreign currency.
“We have huge stocks,” said Golam Mostafa, chairman of Deshbandhu Group.
The sugar import initiative coincides with falling prices both at local and international markets.
Presently, sugar is retailing at Tk 55-60 per kg, down 15 percent year-on-year, according to data from the Trading Corporation of Bangladesh.
Mostafa said the world market was seeing a surplus this year for increased production in various countries. Until September 10, the government had 41,951 tonnes in stock, according to the ministry data.
Of it, 23,471 tonnes will be required for various law enforcing agency personnel. The rest 18,480 tonnes will be inadequate to meet emergencies and control market prices, said ministry officials.
Sugarcane production is likely to be hampered by recent massive rains and floods, putting mills at risk of failing to reach production targets from November.
Industries ministry officials said duty and VAT would be waived so that the cost remains low.
Mostafa Kamal, chairman of Meghna Group of Industries, said private refiners would face increased competition because of government imports.
“We have five refineries in the country and have a surplus processing capacity than annual requirement. The government can buy from us,” he said.
Private refiners can process up to 34 lakh tonnes of imported raw sugar a year whereas local consumption was 23.40 lakh tonnes in fiscal 2016-17, according to estimates of the US Department of Agriculture. Sugar consumption is forecast to rise to 24.95 lakh tonnes at the end of the current fiscal 2017-18.
Imports slipped marginally to 22.15 lakh tonnes in 2016-17 from 22.83 lakh tonnes the previous year, according to the USDA.
Public mills can meet less than 5 percent of the total local demand.