Syndicated traders are creating a fake crisis of essentials in the market while the country does not have any shortage in production, import and supply, commerce ministry data show.
Coronavirus fear-induced panic buying is also helping them raise prices of grocery items.
Prices of most grocery items, including rice, onion, soybean oil, sugar and lentil, were soaring in Dhaka in the wake of the number of Covid-19 patients in Bangladesh rising to 27 on Sunday with two confirmed fatalities.
The traders are overcharging the customers, who are loading up on essentials. Rice market is the worst victim of panic buying, with the staple price increasing by Tk5-10 per kg in a week.
Rice wholesalers and millers are playing the blame game, which is edging up rice prices with no sign of stopping.
Rice wholesaler in Karwan Bazar Ariful Islam said the millers have slashed rice supply and are overcharging for the staple.
"This is responsible for the price hike," he said.
The millers claimed they are charging more for rice as they had to pay more to buy paddy from middlemen.
They said most farmers do not have paddy in stock as the Aman harvesting season is over.
"Hike in paddy price is the main reason for the surge in rice price," says Layek Ali, general secretary of the Bangladesh Auto Major and Husking Mill Owners Association.
Food ministry Secretary Mosammat Nazmanara Khanum, however, categorically dismissed the claim. She said the millers bought paddy two months ago from the farmers.
"Therefore, there is no reason to consider the claim that the millers are now purchasing paddy at a hiked rate," added the secretary.
She warned stern action against dishonest millers and said a number of food ministry teams are looking into the matter.
According to the commerce ministry, the government has a stock of essentials nearly 40 percent more than the previous year. State-owned Trading Corporation of Bangladesh has enhanced its capacity for open market sale.
Seven teams of the Directorate of National Consumer Rights Protection are regularly monitoring markets to bring down grocery prices.
The directorate is also fining traders every day for overpricing.
Kitchen market analysis shows onion price started dropping from mid-March, owing to India's lift on ban and arrival of local onion in market.
Price of onion bulb edged down to Tk40-45 per kilogramme for a brief period and surged again to Tk80 a kg riding on the coronavirus fear.
Prices of other grocery items – from ginger to soybean oil – followed onion's lead.
Private firms also have enough in stock
Apart from the government, the conglomerate companies also have enough stocks.
"There is no impact of virus so far on raw material import. Rather, we are boosting supplies to our outlets," said Meghna Group Deputy Managing Director Asif Iqbal.
He said there will be no shortage of essentials even if the virus lingers until Ramadan, which will begin in the last week of April.
Tackle market syndication, stop panic buying: CAB
The Consumers Association of Bangladesh (CAB) has advised a coordinated approach to deal with the situation -- combating market syndicates and stopping panic buying at the same time.
"Some unscrupulous traders are certainly exploiting the situation. They have to be thwarted," said CAB President Ghulam Rahman.
The consumers will also have to refrain themselves from hoarding, he added.
In the meantime, Monjur Mohammad Shahriar, deputy director of the Directorate of National Consumer Rights Protection said the situation will return to normalcy soon.
"We do not have any shortage. We are bringing businessmen, who are destabilising the market, to book," he commented.
Shopping malls to remain shut
The Shop Owners' Association has decided to shutter shopping malls in the capital from March 25 to 31 amid fears of coronavirus spread, said Bangladesh Dokan Malik Samity.
In a press release, the association on Sunday said kitchen markets, pharmacies, grocery shops and superstores will remain open.
Sabbir Hasan Nasir, executive director of ACI Logistics Limited (Shwapno), told The Business Standard on Sunday night that no decision to shut super shops was made yet by the association of super shops.
The shopping mall owners association's Dhaka unit came up with the closure decision on Sunday evening, saying, "As the shopping malls became deserted due to the spread of coronavirus, we have decided to keep them closed to save our staff and owners from getting infected."
In the meantime, Bashundhara City Shopping Mall Shop Owners' Association decided on a temporary shutdown from March 25 to April 2, said association President MA Hannan.
Footwear manufacturer Bata's Executive Director Hashim Reza told The Business Standard that they were yet to make any such decision.
"Our outlets in shopping malls will comply with the shop owners' decision. But the independent outlets will remain open," said Reza.
He, however, said sales had dropped drastically owing to coronavirus fear.