Visiting kitchen markets three days after the government introduced price caps on potatoes and onions, the Dhaka Tribune found not only were the directives entirely ignored, some places were selling these basic food essentials at a higher price.

During the visit to the capital's kitchen markets, potatoes were still being sold at the usual price range of Tk45-Tk50 per kg. Imported onions were priced between Tk60-Tk70 per kg, while local onions were being sold for Tk80-Tk90 per kg.

On Thursday, the government set price limits of Tk35-36 per kg for potatoes, and Tk64-65 per kg for local onions. Retailers in various kitchen markets criticized these price caps, saying it was an attempt to treat the symptom of the problem and not the problem itself.

They also said reducing prices at the retail level is unfeasible without corresponding reductions in the supply chain. Retailers find themselves in a difficult situation, facing pressure from both consumers and regulatory authorities.

Ali Hossen, a trader in Karwan Bazar, was selling potatoes at Tk45 per kg. When asked regarding the government-fixed price cap, he told Dhaka Tribune that the government has fixed the price at Tk35-Tk36 per kg, but they cannot even buy potatoes wholesale at this price.

“We have to buy potatoes from the Shyambazar wholesale market at Tk40-Tk42 per kg and then have to add transportation and packaging costs. I pay Tk15,000 per month as shop rent and also pay the salary of two salespeople. Now if we want to sell at the government-fixed price, we have to close shop,” he added.

He also said that prices are set from the top of the supply chain, while small traders like them have to suffer.

“We do not have any influence here, we are buying at a higher price so we have to sell at a higher price,” he added.

He was selling onions at Tk80-Tk85 for local variants and Tk60 for imported variants.

Shahjahan, another trader of Karwan Bazar, said that the buyers are angry with them for the high price of potatoes and government agencies like DNCRP are repeatedly raiding their business establishments.

“No one is monitoring the top of the supply chain to find out why the price is rising, we sell at higher prices because we buy at higher prices,” he added.

They also said that they are aware of the price set by the government but the thing is that it will take time to be realized.

“We couldn't even buy onion and potato at the price rate fixed by the government. So how do we sell at that price,” said Selim Uddin, another trader.

Traders also emphasized the existence of extensive product syndicates along the supply chain before reaching consumers, which forces them to sell at elevated prices.

Prices in small neighbourhood shops

Besides the larger kitchen markets such as Karwan Bazar, Mohammadpur Town Hall Market, Badda Bazar, and Shyampur Bazar, prices in neighbourhood shops and smaller markets tend to be slightly higher.

During a visit to Notun Bazar in Kallyanpur (Mirpur area), retailers were selling potatoes at Tk50 per kg, local onions at Tk90 per kg, and imported onions at Tk60-Tk65 per kg.

Potato production, information mismatch

According to the Department of Agricultural Extension (DAE) and the Bangladesh Bureau of Statistics (BBS), Bangladesh has a demand for potatoes of 90 lakh tonnes per year and the production this year is 14-11.2 million tonnes.

However, the cold storage owners contest this report.

At a recent press conference, Bangladesh Cold Storage Association President Mostafa Azad said that the DAE said 11.2 million tons of potatoes have been produced this year, while the demand is nine million tons.

“Why would there be a surplus of 2.2 million tons of potatoes when the freezers are empty,” he said.

“20% of storage space in cold storage facilities remains empty this year. According to our information, the production this year is not more than 8.5 million tons,” he added.

The association also said that farmers and potato traders have suffered losses in the past few years and led to the cultivation of mustard, wheat, and maize which led to a fall in potato production.

Moreover, potatoes stored in cold storage decreased by 10.7 million tons to 2.5 million tons in 2023 than last year, the association said.