Spice supplies steady before Eid, but retail prices soar far above wholesale rates

Infographic: TBS

Consumers across the country are not facing any shortage of spices ahead of Eid-ul-Adha, with steady imports keeping markets well supplied, but a sharp gap between wholesale and retail prices is driving up household costs.

Importers say supply chains remain intact despite global geopolitical tensions and war-related disruptions.

Regular shipments from Indonesia, China, Vietnam and India, along with existing stockpiles, are meeting seasonal demand. 

Yet in retail markets, prices are nearly double those seen in the country's main wholesale hub, Chaktai-Khatunganj in Chattogram. 

Comparing prices across different markets, it was observed that retailers are selling essential spices to consumers at a substantial premium compared to wholesale rates.

Nutmeg priced at about Tk750 per kg in wholesale markets is selling for around Tk1,500 in retail. Cinnamon, which costs Tk350-440 per kg in Chaktai-Khatunganj, is retailing at roughly Tk600. Black pepper has risen from around Tk1,020 per kg wholesale to as high as Tk1,600 in retail markets.

Cardamom shows one of the sharpest increases, with wholesale prices of Tk4,000-4,300 per kg climbing to around Tk5,000, adding Tk900-1,000 per kg for consumers.

Turmeric and chilli follow a similar pattern, with wholesale prices of Tk180 and Tk230 per kg rising to about Tk300 and Tk350 respectively in retail markets.

Staple ingredients are also seeing steep mark-ups. Garlic, which sells for Tk40-60 per kg at wholesale level, is priced as high as Tk160 in retail markets. Ginger has increased from Tk90-100 to Tk160, while onions have moved from Tk20-28 per kg to Tk40-50.

Duties and informal trade blamed

Traders attribute the widening price gap to high import duties and weak market monitoring.

According to importers, around 50.8% of the price of cumin – or Tk250 out of Tk500 – is currently paid as duty. Similarly, duties stand at Tk650 per kg for cardamom and Tk220 per kg for black pepper.

Taking advantage of these high duties, a section of unscrupulous traders are importing goods illegally through land ports, putting legitimate importers at a disadvantage in an uneven competitive environment. 

Traders said while surveillance has been strengthened at Chattogram port, it is almost non-existent at land ports.

They further alleged that when customs authorities conduct drives at large superstores for price assessments, panic spreads across the retail market, triggering further price hikes and destabilising the overall market system.

Meanwhile, wholesalers in Chaktai-Khatunganj say prolonged load shedding has caused significant losses, damaging stored onions and garlic in cold storage facilities and warehouses. In some cases, traders have been forced to sell below purchase cost.

Md Idris Mia, general secretary of the Hamidullah Mia Market Traders Association, said onion demand remains moderate while supply is stable. He added that power disruptions have caused large-scale storage losses, putting wholesalers under financial strain.

He also said both farmers and traders are under pressure, arguing that prices "should rise slightly during Qurbani so farmers can recover costs".

Wholesale traders alleged that despite losses, prices have not risen. Instead, retail markets continue to maintain high rates, with little reflection of stable supply.

They warned that unless the duty structure and unchecked profit-taking in the retail market are brought under control, the festive spirit of Eid could be dampened for ordinary people.

Supply stable, pricing volatile

According to traders, imports from major exporting countries continue without disruption, and supply chains are functioning normally.

Between July and April of the current fiscal year, Bangladesh imported around 153,560 tonnes of 12 types of spices. This includes about 69,559 tonnes of garlic, 62,394 tonnes of ginger, 12,534 tonnes of cinnamon, 2,793 tonnes of cumin, 2,321 tonnes of black pepper, 1,257 tonnes of cloves and 1,098 tonnes of cardamom.

Other imports include roughly 753 tonnes of turmeric, 346 tonnes of nutmeg, 345 tonnes of mace and 86 tonnes of chilli.

Traders estimate Eid demand at around 300 tonnes of cardamom, 1,300 tonnes of cinnamon and 2,500 tonnes of cumin, with sufficient stock already available. Some traders say cumin prices may ease in the coming days due to adequate supply.

Customs officials also said there is no risk to supply ahead of Eid-ul-Adha, with steady imports through Chattogram port ensuring adequate stock nationwide.

Raisul Islam, secretary for port customs and VAT affairs, told The Business Standard that "as there is no direct link between the Red Sea or the Strait of Hormuz crisis and the countries from which spices are imported, higher shipping costs should not have a major impact on the market."