Bangladesh’s sugar imports down amid illegal influx
In the 2023-24 fiscal year, Bangladesh’s sugar imports fell sharply by 25% to 13.86 lakh tonnes, down from 18.49 lakh tonnes the previous year. This decline is attributed to a surge in illegal sugar smuggling, which has reduced demand for locally refined sugar. Taslim Shahriar of Meghna Group of Industries noted that demand at their mill has dropped to a third of its capacity due to smuggling. Bangladesh, which needs about 24 lakh tonnes of sugar annually, relies on imports for 99% of its supply.
Bangladesh’s sugar imports saw a sharp decline in the 2023-24 fiscal year as refiners pulled back from placing orders with foreign suppliers due to a surge in illegally smuggled sugar across the borders. According to the commerce ministry, raw sugar imports by refiners dropped to 13.86 lakh tonnes, down 25% from 18.49 lakh tonnes the previous year, reported The Daily Star.
“Demand for locally refined sugar has fallen significantly because of smuggling. Why should we import if there’s no demand?” said Taslim Shahriar, Deputy General Manager of Meghna Group of Industries (MGI), a major importer and processor. MGI can supply up to 3,000 tonnes of sugar daily, but current demand at the mill is now just one-third of that.
Bangladesh requires around 24 lakh tonnes of sugar annually, with five refiners meeting 99% of this demand by importing raw sugar, mainly from Brazil. State-run sugar mills account for just 1% of the supply. However, Shahriar estimates that nearly 7 lakh tonnes of sugar are being smuggled into the country.
The Bangladesh Sugar Refiners Association (BSRA) has long raised concerns about sugar smuggling, and earlier this year, security forces seized several batches of illegally imported sugar.
According to the commerce ministry, imports of refined sugar also fell by over 22% year-on-year, with 1.39 lakh tonnes imported in FY24 compared to 1.79 lakh tonnes the previous year.
Amitava Chakraborty, an adviser at City Group, another major importer and processor, noted that sugar has been entering the country illegally for the past year and a half. “Since this sugar comes in without any duty, it undermines the competitiveness of local refiners,” he said. He also pointed out that the smuggled sugar is often of lower quality and is sold under local brand names, damaging the reputation of domestic companies.
Apart from increasing prices, some other factors like high LC margins and problems with the opening and confirmation of LCs have led to falling sugar imports. “Import duties are very high,” said Golam Mostafa, Chairman of Deshbandhu Group. “Import duties combined with high LC margin need a huge amount of cash investment by importers.
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Source Link : https://www.chinimandi.com/bangladeshs-sugar-imports-down-amid-illegal-influx/
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