Friday, February 11, 2011

Agribusiness Sectors in Bangladesh


Report on Agribusiness Sectors in Bangladesh
Overview & Analysis


2/19/2011
Institute of Management Consulting
Prepared by A.H.M. Zahid Karim





Content

1.0Overview                                                                                                                                         
2.0  GlobalAgribusiness                                                                                                                       
3.0  Agriculture in Bangladesh                                                                                                           
3.1  Bangladesh Agriculture at A Glance                                                                              
3.2  Category of agribusiness                                                                                                   
  3.3 possible agricultural sectors                                                                                     
4.0  Agribusiness Sectors in Bangladesh                                                                                            
4.1  Rice Potentials                                                                                                                   
4.2  Rice bran oil eyes market                                                                                               
4.3  Wheat Potential                                                                                                                
4.4  Maize Potential                                                                                                                 
4.5  Potential Value Added Products of Grain                                                                     
4.6  Seed Industry                                                                                                                     
4.7  Market Opportunities in Seed Industry                                                                         
4.8  Fruits & its potential                                                                                                          
4.9  Potential Value Added Products of Fruits & Vegetables                                             
4.10 Investment Opportunity                                                                                         
5.0  Livestock & Poultry Sector in Agribusiness                                                                               
5.1  Present Status of Livestock                                                                                               
5.2  BCR ( Benefit Cost Ratio ) in commercial boiler production                                        
6.0  Aquaculture as Agribusiness                                                                                                      
6.1  Water types and areas available for aquaculture                                                           
6.2  Fish production is growing significant                                                                                        
 6.3  Export of processed fish                                                                                                       
7.0  Forestry as Agribusiness                                                                                                       
 7.1  Contribution to economy                                                                                                      
8.0  Fertilizer Production as Agribusiness                                                                                   
 9.0  Agro service  centre as Agribusiness                                                                                              
10.0  Others Subsectors as Agribusiness                                                                                        
 10.1  Tannery Business                                                                                                            
10.2  Mushroom production and sales business                                                                 
10.3  Feed, fodder, and bio-fertilizer business                                                                    
10.4  Flowers business                                                                                                             
10.5  Bio-pesticides and bio-control business                                                                      
10.6  Apiculture business                                                                                                          
10.7  Urban agriculture service                                                                                                
10.8  Agriculture education sector                                                                                         
11.0SWOTAnalysis                                                                                                                              
        12.0 References                                                                                                                                    
                                                                                                                                                                       

1.      Overview
Agriculture is the single most important sector in Bangladesh's economy. Over 80% of the population (or 70% of the workforce) of Bangladesh is engaged in agriculture. The share of agriculture in GDP has fallen from around 57% in the 1970s to 23% in recent years. Nonetheless, agriculture is still one of the largest economic sectors in Bangladesh. The agriculture sector is also the source of many of the small industrial sector's raw materials, such as jute, and accounts for 10% of Bangladesh's exports. In short, agriculture is the driving force behind economic growth in Bangladesh and, as a result, increasing food and agriculture production have always been major concerns of Bangladeshi policy-makers.
Bangladesh's major crops include: rice, jute, tea, wheat, cane, oilseeds, potatoes, pulses, and spices. Rice is by far the largest, with an average 71% share of the gross output value of all crops. As a result, growth in the agricultural sector essentially mirrors the performance of rice production, although the share of livestock and fisheries has increased steadily in recent years to 22% of the value added in agriculture.
Bangladesh's dependence on food imports and, in particular, food aid throughout the years has been a cause for concern. In 2006-07, agri-food imports in Bangladesh represented approximately $1.9 billion (8% of total imports) and were worth about 9% of total export earnings. The Bangladesh Agricultural Research Council (BARC) estimates the future requirement for food grains to be about 45 million tonnes in 2030 (compared to 25 million tonnes in 2000).
Total Bangladesh/Canada agricultural trade was valued at over $265 million in 2007 (January - November), and represented over 32% of total trade between the two countries. Top Canadian agricultural exports to Bangladesh were wheat, valued at $164 million and accounting for over 50% of all agri-food exports, and peas (dried), valued at $70 million or 22% of total agri-food exports.





2.      Global Agribusiness
Ø  Global  share of demand for Food & Beverages  is increasing  in emerging region s thus driving  continued globalization.
Ø  Asia Pacific region  with 32% food and beverages retail sales  stood as a reigning leader.
Ø  The estimated value of the global processed food industry was  USD 4.2 trillion  in 2008-09.
Ø  European Union , the US and Japan accounted for more than 60% of total global processed food retail sale.
Ø  Although China and India are growing substantially, Japan is currently the largest food processing market in Asia.
Ø  Apart from Asia, Australia has one of the most technically advanced food processing industries  in the world.
Ø  Major players in the industry  include Altria Group,  PepsiCo, The Coca-Cola Company, British American Tobacco, Cadbury etc
3.0  Agriculture of Bangladesh

Bangladesh is primarily an agrarian economy. Agriculture is the single largest producing sector of economy since it comprises about 30% of the country's GDP and employing around 60% of the total labour force. The performance of this sector has an overwhelming impact on major macroeconomic objectives like employment generation, poverty alleviation, human resources development and food security.
Meeting the nation's food requirements remain the key-objective of the government and in recent years there has been substantial increase in grain production. However, due to calamities like flood, loss of food and cash crops is a recurring phenomenon which disrupts the continuing progress of the entire economy.  Agricultural holdings in Bangladesh are generally small. Through Cooperatives the use of modern machinery is gradually gaining popularity. Rice, Jute, Sugarcane, Potato, Pulses, Wheat, Tea and Tobacco are the principal crops. The crop sub-sector dominates the agriculture sector contributing about 72% of total production. Fisheries, livestock and forestry sub-sectors are 10.33%, 10.11% and 7.33% respectively. Bangladesh is the largest producer of Jute. Rice being the staple food, its production is of major importance. Rice production stood at 20.3 million tons in 1996-97 fiscal year. Crop diversification program, credit, extension and research, and input distribution policies pursued by the government are yielding positive results. The country is now on the threshold of attaining self-sufficiency in food grain production. 

3.1 Bangladesh Agriculture at a Glance


Total family
:
17,600,804
Total farm holding
:
15,089,000
Total area
:
14.845million hectare
Forest
:
2.599 million hectare
Cultivable land
:
8.44 million hectare
Cultivable waste
:
0.268 million hectare
Current fellow
:
0.469 million hectare
Cropping intensity
:
175.97%
Single cropped area
:
2.851 million hectare
Double cropped area
:
3.984 million hectare
Triple cropped area
:
0.974 million hectare
Net cropped area
:
7.809 million hectare
Total cropped area
:
13.742 million hectare
Contribution of agriculture sector to GDP
:
23.50%
Contribution of crop sector to GDP
:
13.44%
Manpower in agriculture
:
62%
Total food crop demand
:
23.029 million metric ton
Total food crop production
:
27.787 million metric ton
Net production
:
24.569 million metric ton
Source: BBS, 2006 and Handbook Agricultural Statistics, MoA



3.2 Category of agribusiness in Bangladesh
1. Input sector
2. Commercial farm production sector
3. Product sector(storage, processing, marketing, wholesaling and retailing exports
4. Service sector (education ,banking, finance, investment and technical advice)

3.3 Possible agribusiness sectors like
·          Business service
·          Crops
·          Livestock
·          Poultry
·          Fisheries
·         Fertilizers, Chemicals & Animal Pharmaceuticals
·          Agro Forestry
·          Agro processing
·          Agro-inputs
·          Agricultural Education.

4.0  Agribusiness Sectors in Bangladesh
Agribusiness companies diverse private agro enterprises a majority of which are small mostly in rural market towns and operated by households that often have wage labor and farming as other sources’ of income. Medium and large agro enterprises are mainly urban based because of the requirements for economics of scale and infrastructure. The large enterprises are often dominated by multinational corporations that have consolidated through vertical and horizontal integration.
In recent years influenced by changes in consumer demand and rapid technological and institutional innovation the structure of agribusiness has changed dramatically and its performance has been highly dynamic. Two major challenges need to be address in considering the role of agribusiness for development. Hundreds of agribusiness trade organizations, commodity organization, committees are present in Bangladesh including the crops, livestock, fisheries and forestry and other including planning and genetic materials, agrochemicals, equipment and pharmaceuticals. Most well known Agribusiness Company in Bangladesh is Square company Ltd, ACI company Ltd, Milk vita, Aftab Group, Arong Group, Akij Consumers Foods & beverage, Kazi Farms Group, BD Foods, T.K. Consumer Products, Acme Consumer Foods etc. Agribusiness companies provide input supplies to the production agriculturalist. The production agriculturalist produces food and fiber and cotton, wools etc) and the output it is taken by agribusiness companies that process, market and distributes the agricultural products. Market forces do not guarantee competitiveness nor do they guarantee smallholder participations both essential to link agricultural growth to development. The two complement each other as competitive small and medium agro enterprises in rural areas can link smallholders to value chains and urban demand.

4.1  Rice Potentials
Rice mills of various capacities have grown throughout the country. The indigenous ‘dheki’ method of rice husking has been largely replaced by mechanized rice milling. However, mechanized rice milling in Bangladesh is itself a century old technology — known as the engel-berg huller system. The extent of processing and storage of paddy depend on locations: the farm for extended personal consumption, the village where producers and traders interact, and urban areas where storage facilities set up by public agencies are found. There are 100.405 (100,000 engel-berg, 38 Chiness automatic and 25 large automatic) rice mills of different sizes and categories spread throughout the country. The engel-berg rice milling system is defective. About 20,000 engel-berg type rice mills are being established every year. These rice mini-mills have widely decentralized the rice milling industry. Over the years, some technological 90 Bangladesh Journal of Political Economy Vol. 20, No 1 improvements have been introduced, (a) including parboiling the paddy to conserve its vitamins, reduce the proportion of broken rices, (b) mechanical drying of paddy, (c) use of rubber roller sellers to minimizes grain breakage, (d)
utilization of husks as fuel for boilers and dyers and as raw materials for products such as cement and (e) evolution of mechanisms to separate rice bran from husks to extract oil from rice bran. Rice bran is also used as good feed for fish and poultry. According to one estimate, about two million MT of rice bran (at 10 percent of the weight of clean rice) could be produced from about 20 million MT of clean rice in Bangladesh annually. Most of it is used as fuel for cooking purposes and/or in boilers (mixed with husks). Through slight modification in the existing engel-berg system, 200,000 MT of quality edible oil could be produced from rice bran. The rice bran oil could meet about 50 percent of total consumption. According to one estimate, 400 MT of rice bran oils are produced in the country. Rice bran oil is a good quality edible oil having balanced fatty acid composition and valuable micro components. Bangladesh is deficit in edible oil. Locally produced oil can hardly meet 30 percent of the country’s total requirement.’ The country spends over Tk. 10,000 million every year to meet import bills of edible oils. Rice bran oil produced from rice mills could substitute for a huge quantity of the imported edible oil every year.Besides extracting oil from rice bran, there exists tremendous scope to export fine quality rice from Bangladesh to the EU and USA markets. However, this will need a comprehensive collaborative approach involving producers, millers, exporters and financial institutions. A number of incentive packages would be necessary to boost export of fine quality rice on a competitive basis with the neighboring countries.
4.2 Rice bran oil eyes market
Through slight modification in the existing engel-berg system, 200,000 MT of quality edible oil could be produced from rice bran. The rice bran oil could meet about 50 percent of total consumption. According to one estimate, 400 MT of rice bran oils are produced in the country. Rice bran oil is a good quality edible oil having balanced fatty acid composition and valuable micro components. Bangladesh is deficit in edible oil. Locally produced oil can hardly meet 30 percent of the country’s total requirement.’ The country spends over Tk. 10,000 million every year to meet import bills of edible oils. Rice bran oil produced from rice mills could substitute for a huge quantity of the imported edible oil every year.
A new avenue is set to open up on the edible oil market as Rashid Oil Mills Ltd has moved to extract oil from rice bran. Company officials expect that the product will attract a wide spectrum of consumers. The company said it set up a plant in Baharpur area of Ishwardi in Pabna by investing about Tk 20 crore. The new entrant with a daily capacity of producing between 60-84 tonnes oil from the extraction of about 300 tonnes of rice bran, is expected to supply between 18,000-25,200 tonnes of rice bran oil a year to market.

4.3 Wheat Potential
Wheat flour is widely used in bread and biscuit production. Wheat processing industries are growing fast in the country. The bread and biscuit industries range from small bakeries to automated factories. Bread and biscuits are marketed throughout the country. Bread and biscuits are recognized as convenient food (fast food item). There is scope to enrich bread and biscuits through fortification with soya-protein. There is ample scope to use soybean — a protein rich food crop with breads and biscuits to substitute protein deficient food items — based on cereals. Soya fortified breads and biscuits could be served as tiffin items to the school children to improve their nutritional status. This could, on the one hand, help the development of local bread and biscuit production industries and, on the other, increase the intellectual capacity of our rural population due to intake of protein rich food as our future manpower reservoir. This would also encourage more children to attend schools and would minimize drop-outs. It is also possible to produce cereal based baby foods in the country. Locally produced baby food items could be substituted for imports and even exported. Bangladesh could earn needed forex by exporting baby food items to neighboring countries.
4.4 Maize Potential
Poultry farms are flourishing in our country very fast, which creates great demand for animal feed. Flour can be produced from maize for preparation of different kinds of food and feed items. The soil and climatic conditions are congenial for boosting up maize production in the country. By boosting up production the deficit could be mitigated which would save a lot of foreign exchanges.
4.5 Potential Value Added Products
                                                         Potential Value Added Products
                       
Grains
Low Level Value Added   Products
Medium Level Value Added   Products
High Level Value Added   Products
Paddy
Clean, coarse, fine and glutinous rice
Rice polish, rice flake, rice flour fortified with
vitamins and minerals, popped rice
Baby food, drink, breakfast cereals, rice
bran oil
Wheat
Flour, maida, suji,
wheat bran
Pastry, bread, biscuit, fortified flour, graded
flour, cake
Uni or mixed flake, macaroni, noodles,
baby food, gluten
Maize
Flour, feed, baby
corn
Popped corn, protein
concentrate
Uni or mixed flake, starch, corn syrup,
corn oil, ethanol, glucose, dextrose and
lactose





4.6 Seed Industry
The seed industry in Bangladesh comprises of both public and private sector initiatives. In the private sector, there are more than 100 companies involved, with over 5000 registered seed dealers operating across the country. The recent expansion of the private sector seed companies has resulted in the engagement of thousands of contract farmers into the formal seed production chain, leading to improved livelihoods amongst the rural community.
Government agencies involved in this sector include Bangladesh Agricultural Development Corporation (BADC), Bangladesh Agricultural Research Institute (BARI), Bangladesh Rice Research Institute (BRRI), Bangladesh Jute Research Institute (BJRI) and Department of Agriculture Extension (DAE). The government has recently given the seed sector a “priority” status.

4.7 Market Opportunities in Seed Industry

Varieties

Total Demand
(Ton)

           Total Supply

Total Supply


Government
Sectors

Private
Sectors


Rice
313955
74314
3350
77664
Wheat
72000
19051
?
19051
Maze
3300
233
3000
3233
Jute
3570
456
1350
1806
Pulses
21350
245
?
245
Oil Seed
13500
398
?
398
Vegetable
Seed
2700
63.2
728
791.2

Spice Seed
101875
42 !!
65!!
107!!
Potato
400000
9231
5000
14231
Total
932250
104033.2
13493
117526.2
Source: Seed Wing, Ministry of Agriculture, 2006

4.8 Fruits & Vegetable
Bangladesh produces about 1.49 million MT of fruits annually. Banana is by far the single major fruit occupying 44 percent pf the total fruit production in Bangladesh. Jackfruit (18 percent) is the second largest fruit followed by mango (13 percent) and pineapple (10 percent). Rangamati, Rangpur and Barisal are the major zones where banana is grown. Dhaka, Sylhet, Tangail and Kushtia produce most of the jackfruit grown in the country. Rajshahi, Sylhet, Rangpur and Dinajpur are major mango producing regions, while Sylhet, Tangail, Rangamati Hill Tracts and Dhaka are the major pineapple growing regions.

4.9 Vegetable production & consumption in Bangladesh
Area
0.278 million ha
Production
1.88 million MT
Present Consumption
45/day/person (BBS),120g/day/person (AVRDC)
Recommendation
220g/day/person
Requirement (as per recommendation )
11.24 million MT
Production to be increased (as per recommendation )
6 folds of the present production


4.10 Potential Value Added Products of fruits & vegetables
There are ample opportunities to earn foreign exchange by exporting fruits in fresh and processed manner abroad. There are lot of scopes to establish more fruit processing plants and/or modernize the existing ones.
                                                         Potential Value Added Products
                       
Fruits
Low Level Value Added   Products
Medium Level Value Added   Products
High Level Value Added   Products
Jackfruits
Consumer Pack, Dehydrated
Products, Leather
Jam, Jelly, Squash
Pectin, Drink
Mango
Leather,Dried Products, Pickle
Jam, Jelly, Squash, Canned Products, Pulp, Candy
Juice, Canned Products, Instant Powder
Pineapples
Pulp, Dehydrated And Dried Products
Jam, Jelly, Candy, Squash
Juice, Canned Products, Slice, Fiber
Banana
Dried Products
Puree, Pulp, Cooked Products
Chips, Drink, Flake
Papaya
Jam
Candy
Papine, Pectin, Instant
Powder
Lemon
Pickle
Squash, Juice
Citric Acid, Lemon Oil



                                                         Potential Value Added Products
                       
Vegetables
Low Level Value Added   Products
Medium Level Value Added   Products
High Level Value Added   Products
Potato
Chips
Flake
Starch Cellulose
Tomato
Pickle, dehydrated products
Catch up, sauce, paste, soup
Whole canned, cereal flake, juice, instant powder
Peas

Dehydrated
Canned, frozen
Carrot

Dehydrated
Juice

4.11Investment Opportunity
• Integrated water resource management
• Technology genera_ on system
• Technology dissemination or extension system
• Agricultural marketing services
• Soil health maintenance
• Climate change adaptation
• Provision of agricultural financial services
• Modernization on of agricultural education system

5.0  Livestock & Poultry Sector in Agribusiness :
Livestock is an integral component of agricultural economy of Bangladesh performing multifarious functions such as provision of food, nutrition, income, savings, draft power, manure, transport, social and cultural functions. About 75% of the population rely to some degree on livestock for their livelihood specially the landless farmers. Infants, adolescents and elderly people live on milk to a greater extent majority of which is imported from abroad at the cost of hard earned foreign currency.

 5.1  Present status of livestock

Livestock population in Bangladesh in 2007-08 was cattle 23 million, Buffalo 1.3 million. Goats 21.6, sheep 2.8 million, chicken 212.5 million and ducks 39.8 million (Bangladesh Economic Review-2009 and DLS). The per capita number of cattle was o.16, goats 0.15, sheep 0.01, chicken 1.47 and ducks 0.27.

Table 2. Contribution of sector wise GDP at constant price (base yr.1995-96)
Percent Sub sector
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-7
2007-08
Crops and Vegetables
14.33
14.59
14.70
13.75
13.43
13.23
12.51
12.28
12.00
11.64
Livestock
3.12
3.02
2.95
2.96
2.93
2.91
2.95
2.92
2.88
2.79
Forestry
1.90
1.88
1.87
1.88
1.86
1.83
1.82
1.79
1.75
1.75
Fisheries
5.93
6.09
5.51
5.40
5.25
5.11
5.00
4.86
4.73
4.67

Table 3. Demand, supply and deficit of meat, milk, and eggs/person/year (2007-2008)
Products
Requirement
Available
Deficit
Percent of deficit
Meat (kg)
43.25
9.12
34.13
78.9
Milk (lt)
91.25
17.50
73.75
80.82
Eggs (No)
104
36
68
65.35

Today the poultry sector in Bangladesh is contributing significantly to national economy. Accordingly to an estimate, the poultry farmers are currently producing more than 400 million broilers and 6.6 billion eggs every year. At present, around 40 per cent of country’s meat requirement is met by poultry and the sector is growing at the rate of more than 10 per cent. The sector is not only supplying, animal protein at an affordable price, but also created more than 6 million employment in the country.




5.2 BCR ( Benefit Cost Ratio ) in commercial boiler production :-
(estimate for 100 birds )
Particulars
Small
Medium
Large
All
Variable cost items
Feed Cost

6600

5800

6900

6433
Day Old Chick
5050
5000
4800
4950
Hired Labor
500
550
600
550
Veterinary Cost
400
420
475
432
Electricity
150
180
165
165
Carrying Cost
100
110
85
98
Total variable Cost
12650
12060
13025
12578
Fixed cost items
Family Labor
460
320
280
353
Housing Cost
130
140
120
130
Tools & Equipment
120
100
85
102
Interest on operating capital
650
750
850
750
Land use Cost
70
65
50
62
Total Fixed cost
1430
1375
1385
1397
Total Cost
14080
13435
14410
13975
Gross Return
16200
16800
17400
16800
Net Return
2120
3365
2990
2800
Benefit Cost ratio
1.15
1.25
1.20
1.20




6.0  Aquaculture as Agribusiness

Actual fish production by farmers is now only one link in the entire value chain of the fish industry with perhaps much less than one-half of the total value addition of the industry. The whole chain of activities, beginning from the backward linkage activities of production and marketing of fish seed and fish feed, and continuing through the forward linkage activities of icing, transportation, storage, processing and retailing or export, that are supported by agribusiness-focused aquaculture has not only made significant contribution to employment and income generation in these linkage activities but also revitalized aquaculture by opening up a larger market for its products. The additional employment and income generated in the fisheries industry create demand for other products and thus support the growth of other economic activities. The relative stagnation of crop agriculture and the very robust growth of aquaculture suggest that aquaculture has the potential to act as one of the major thrust sectors for the economy pushing out the frontiers of production possibilities of the country. This needs to be explicitly recognized by the government and acted upon on the policy front to allow
aquaculture to play its due role in national economic development.
6.1 . Water types and areas available for aquaculture.
Water type
Area (ha)
Cultured (ha)
New potential (ha)
Pond and ditch
305 025
198 179
106 846
Baor (oxbow lake)
5 488
5 488
-
Floodplains, paddies
2 832 792
?
700 000
River, canal
1 031 563
?
100 000
Road, railway side canals
?
?
?
Shrimp ghers (estate)

203 071
100 000
The total production of fish registered a growth of 22% over the last five fiscal years. During the same period, inland fisheries and marine fisheries recorded a growth of 25% and 9% respectively. The total production of fish in the country, from both sources, i.e. inland and marine, in the FY 2007-08 was 2.563 million MT, of which 2.354 million MT (92%) was white fish and the rest 0.209 million MT (8%) were shrimps and prawns.
The contribution of fisheries in the national economy of Bangladesh is significant, particularly with reference to food consumption, nutrition, employment, and export. 8% of the total population is directly or indirectly engaged in the fishing industry (and close to 160 million people lives in Bangladesh)

6.2 Fish production is growing significant
About 80% of the total fish production in Bangladesh is inland fishing, which is divided equally between captured and cultured fishing.
Almost all the districts of the country have ponds, baors, beels, floodplains, rivers, etc. Therefore, white fish as well as shrimps, are available more or less in every district of the country. All inland fishing is primarily based on small scale farming with thousands of farmers having each their own little pond etc.
The inland fish production in Bangladesh grew by 25% on average during the last five fiscal years. In the fiscal year 2007-08, a total of 2.066 million metric tonnes of fish, including 0.135 million tonnes of shrimp & prawn, was produced in a total water area of 4.575 million hectares.
In the FY 2007-08, Bangladesh exported 75,299 metric tonnes of shrimps, fish and fish products worth USD 492.38 million. In the same fiscal year, the contribution of export of processed white fish and fish products was 24,649 metric tonnes worth USD 64.76 million (13%). The export of processed white fish and fish products has registered a steady growth in the last two decades. In the last five fiscal years, the contribution of processed white fish and fish products grew from 20% to 33% and 9% to 13% in volume and value respectively. In 2007-08 Bangladesh processed white fish and fish products worth USD 64.76 million and exported to 14 different countries of the world. 47% is to Asia, 17% to the Middle East and the last 36% to USA, Canada and Europe.
7.0 Forestry as Agribusiness
Of the total area of Bangladesh, agricultural land makes up 65% of its geographic surface, forest lands account for almost 17%, while urban areas are 8% of the area. Water and other land use account for the remaining 10%. The total forestland includes classified and unclassified state lands and homestead forests and tea/rubber gardens. In case of private forests, the data represent the tree-covered areas.
Of the 2.52 million hectare Forest Land, Forest Department manages 1.52 million hectare which includes Reserved, Protected and Acquired forest and Mangrove forest on the newly accreted land in estuaries of major rivers. The remaining 0.73 million hectare of land designated as Unclassed State Forest (USF) are under the control of Ministry of Land. Village forests (homestead land) form the most productive tree resource base in the country and accounts for 0.27 million hectare.




Table - 1 Total Forest Land of Bangladesh

Category of Forests
Area (Million Hectare)
Percentage
Forest Department Managed Forests
1.52
10.30
Unclassed State Forest
0.73
4.95
Village Forest
0.27
1.83
Total
2.52
17.08






7.1 Contribution to economy :
Economic participatory social forestry contributes towards rural poverty reduction significantly. In the last 3 years, out of total sale proceeds of timber and fuelwood about 308 (three hundred and eight) million taka has been distributed to 23561 participants. Social Forestry Rules have been framed to give the legal basis of benefit sharing system. Tree farming fund has been created from the 10% of the sale proceeds to create new resources on the same pieces of land involving the same participants, to ensure sustainability. The TFF operating committee has been established involving local government and Local Community Organization (LCO).
In 2001-2002, about 2% (two percent) of the total manpower of the country was engaged in the forestry sector. Many people actually benefited directly from forestry-related activities e.g. in wood based industry, saw milling, furniture making, establishing private nursery, logging, extraction and in afforestation programs. Besides this in Sundarban millions of people are dependant on the the mangrove forest for their livelihood (e.g mawali, bawali, fisherman etc).
Fuelwood is the major wood product required today, Bangladesh needs over 8.0 million cubic meter fuelwood every year. Domestic cooking uses an estimated 63%, which is 5.1 million cubic meter annually. Industrial and commercial use is also significant, which is 2.9 million cubic meter annually. According to Forestry Master Plan, village household supply about 75% of the fuelwood in the country where as government forestry program provides the rest 25%.

8.0  Fertilizer Production as Agribusiness
The national demand of Urea, TSP, MOP,DAP fertilizers in the year 2010-11 are 28.31 Lac MT, 5.60 Lac MT, 4.90 Lac MT, 3.40 Lac MT respectively.  The non-urea demand in the year 2010-11 is 13.90 Lac MT where our production was 3.06 Lac MT in the year 2009-10.

FAO SYB-2009
Total Fertilizer Production (tones)
Total Fertilizer Consumption (tones)
Year
2004
2005
2006
2007
2004
2005
2006
2007

Bangladesh

988,160


949,668


884,716


920,706


1,389,777


1,564,390


1,522,338


1,524,227




9.0  Agro service  centre as Agribusiness
Population of Bangladesh is increasing day by day and on the other hand the cultivable land is decreasing. Pressure is being mounted on food with the increase of population in the country. So as a part of food demand of fresh vegetable and fruits is also increasing. Moreover, a large number of people in Bangladesh is suffering from malnutrition due to less consumption of vegetables and fruits.  To increase the nutritional status of the growing population , the demand of vegetables and fruits knows no bound. In this circumstance, commercial agro service centre can play a vital role to produce agro commodities.  In government sector BADC already has taken steps to meet the demand by its 13 agro service centre.

10.0          Others Subsectors as Agribusiness

10.1 Tannery Business
Tannery industry is one of the most important agribusiness sectors. There are 240 industries in Bangladesh so many are involving this sector for doing business and also Govt can export it for earning huge amount money.

10.2 Mushroom production and sales business
Mushroom production for domestic consumption and export can be enhanced with
improvement in the state of art of their production and also a important agribusiness
sectors. Already many companies are producing and sale in the domestic market with
high price.
10.3 Feed, fodder, and bio-fertilizer business
As agricultural country there is increasing demand of agricultural inputs like feed,
fodder, and bio-fertilizer.for meeting the demand almost some of public and private
company doing this business.
10.4 Flowers business
Flowers business is one kind of agribusiness sector of Bangladesh. There are lots of
wholesale and retail markets (Kharmar Bari and Shahabag) of flowers. Many people
are engage in it and earning huge money.
10.5 Bio-pesticides and bio-control business
As an agricultural based country there is a lot of demand of Bio-pesticides and biocontrol agents to prevent the crop from pests. On the basis of this demand many company has been doing Bio-pesticides and bio-control business like SUMITHION insecticide by SHETU Corporation, ACTELLIC 50 EC by ACI Bangladesh Ltd and al so by Bayer crop science Ltd.
10.6 Apiculture business
Apiculture is other kinds of agribusiness, much of company are engaged in
Apiculture business, producing honey and distribute within and across the country.
10.7 Urban agriculture service
It is one of the agribusiness sectors. Much company doing their business with some
aesthetic products, business for both indoor and outdoor landscaping by different
kinds of Moths and Butterfly.
10.8 Agricultural Education sector
Already some public and private universities have started to provide degree in Agribusiness. Recently a national foundation named "National Agribusiness foundation of Bangladesh (NAFB)" has emerged in Bangladesh with a highly motivated people.
11.0 SLOT Analysis of Agribusiness in Bangladesh

Strengths
·         Large population
·         Natural and Comparative Advantages
·         Policy Reforms and Shift in Government/Private Sector Roles
·         Entrepreneurial Base
·         An emerging force represented by Associations
·         Farmer friendly agricultural credit policy
·         Increased subsidy on Agricultural Inputs (Fertilizer, diesel, electricity, seeds)
Limitation
·         Lack of a comprehensive policy for agribusiness development
·         Weak Institutions (private and public) Supporting Agribusiness Development
·         Weak Capacity in Resolving Agribusiness Problems
·         Exclusion of Women from Agribusiness Activities
·         Inadequate Infrastructure for Agribusiness Development
OPPORTUNITIES
o   Modern technological know-how is available for dissemination
o   Scope for expanding hybrid technology exists(10%)
o   Prospects for adoption of advanced technology in agriculture are bright
o   Potentials for proper utilization of hilly/coastal areas including agro-ecologically disadvantaged regions exist
o   Export potentials exist for high-value crops
o   Scope for crop diversification, intensification and value addition to agricultural produces
o   Agriculture sector has capacity to absorb labor force and to generate income
o   Scope for reducing yield gaps exists 


Threats
o   Rapid shrinkage of agricultural land @1% p.a.
o   Population growth @1.48% p.a.
o   Climate change and variations
o   Rapid urbanization growth @12% p.a.
o   Agricultural research and education (manpower shortage, updating course curriculum)
o   Technology generation (needs expertise, time and money)
o   Technology dissemination (needs expertise,  time, logistics support)
o   Alternate livelihoods/rehabilitation program
o   Inadequate value addition /food processing









References
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