Rock solid syndicates run potato market
The potato market has completely gone in the hands of syndicates. Traders are taking excess profit from the market by creating artificial crises by blaming each other. Unscrupulous traders are not selling potatoes at the price set by the government.
In the last six days, the fixed price of potato from cold storage to retail outlet has not been implemented. Potatoes were sold at Tk 48 to Tk 55 per kg in Dhaka market on Tuesday.
Meanwhile, this year at the beginning of the season in March, farmers sold potatoes at Tk 10 to Tk 12 per kg. But the potato market started to become unstable from July. Currently, at the retail level, potatoes have to be bought at Tk 48 to Tk 55 per kg. Usually in March, farmers sell potatoes to small traders and wholesalers. Prices then start to rise in July and hit a three-month high between September and November. Agriculture sector stakeholders say that every year the price of potatoes is mainly manipulated at the cold storage stage. Small traders, cold storage owners and wholesalers played a role in this.
The sale of potatoes has been stopped from about 380 cold storages in the country. If this continues, the stakeholders fear that the price of potatoes will rise again in the retail market due to supply shortage. Instructions were given to sell potatoes from cold storage at Tk 26 to Tk 27 per kg through authentic receipts from Sunday.
But potatoes were not sold at this price from any cold storages. 'Sleep trading' is going on in the potato market. The business model is similar to the 'SO & DO' business in the edible oil and sugar markets. Stored potatoes are sold to many people through slip trade by cold storage owners and stockists.
The syndicates took a huge amount of money. The potato market is becoming a hostage in the hands of slip-holding syndicate traders.
According to the related sources, if potatoes are sold at the fixed price of Tk 26 to Tk 27 in cold storages, after deducting all the costs, the profit of the stock traders will be up to Tk 8 to Tk 10 per kg. Apart from this, if potatoes are sold at Tk 35 to Tk 36 at the retail level, there will be a profit of Tk 6 to Tk 7 at the wholesale level.
And at the retail level, traders will make a profit of Tk 3 to Tk 4 per kg. But at the current price, cold store owners and stockists are making a profit of Tk 18 to Tk 20 per kg of potatoes. It is alleged that potatoes are still being sold at Tk 35 to Tk 36 per kg in the two cold storages which are operational.
According to the Bangladesh Cold Storage Association, an organization of cold storage owners, if the government sells potatoes at the fixed price, everyone will have a profit. Especially in cold storage, the profit of the stockists will be Tk 7 to Tk 8 per kg. Still they are not releasing the potatoes from the freezer. Unscrupulous traders feel that they cannot break the powerful syndicate of the potato market.
Sources said that since the government fixed the price, the sale of potatoes has almost stopped in the freezers of Munshiganj. The same situation prevails in the cold storages of the districts of North Bengal.
Bangladesh Cold Storage Association President Mostafa Azad Chowdhury Babu said the sale of potatoes has been stopped there.
He said that even if potatoes are sold at the price fixed by the government, everyone will make a profit, but in that case the profit will be a little less. Many businessmen cannot accept this either.
Because of this, the sale of potatoes is stopped. He said most of the potatoes in cold storage are now owned by slip holders.
The owners of the freezer now have no more potatoes. Many professionals and employees bought potatoes from the freezer and took slips. That's the business. Now if they do not sell potatoes, what can the owners of the cold store do!
He complained that many professionals and money owners have come into the potato business. Just buying slips and storing potatoes. A powerful syndicate is emerging in the slip trade. The government's surveillance of these traders needs to be increased. Strict monitoring should be done.
Slip trade in potato business. In edible oil and sugar markets like paper shares, slip trades are typically followed by supply order (SO) or demand order (DO) systems. Similarly slip trade is booming in the potato market. Anyone can become the owner of potatoes stored in cold storage just by buying a slip. Due to this, there are now many owners of potatoes stored in the freezer.
Those who buy and sell potatoes by buying slips are now a very powerful syndicate. Slip trade is now taking place in every cold store in the country. According to the sources, in the name of slip trade in the market, cold store owners and storekeepers withdrew money from DO and SO in need of cash. Now the slip holders are increasing the price of potatoes as they wish.
Meanwhile, the government is in a strict position to control the potato market. Director General of National Consumer Directorate AHM Safikuzzaman recently visited Riverview Cold Storage in Muktarpur area of Munshiganj Sadar Upazila. At that time, he said, Munshiganj district administration and related persons will look into the issue of selling potatoes through receipts.
Agricultural Economist and University of Global Village Vice-Chancellor Dr Jahangir Alam Khan said, "Currently, the farmer does not have any potatoes." Potatoes are now in the hands of cold storage owners. The market is controlled by bullies and big traders. This is where manipulation comes in through syndication."
He said, "The government can stock potatoes the way it stocks rice. Then you can control the market if it is unstable. But even if the price is fixed in this way, there will be apprehension about its implementation. There is work to be done in the main place."