70
•
LIVING THROUGH CRISES
40 35 30 25 20 15 10 5
ay M
Jan
0 Se 8 p 08 Jan 0 M 9 ay 0 Se 9 p 09 Jan 10 M ay 10 Se p 10 Jan 11
0
08
retail prices in Dhaka in real terms (TK)
Figure 2.2. Prices of Staple Foods, 2008–11
Dhaka coarse rice (kg) Dhaka wheat (kg) Bangladesh average coarse rice (kg) Bangladesh average wheat (kg) Source: Department of Agriculture Marketing, Bangladesh, http://www.fao.org/giews/pricetool/.
Among the other commodity spike factors that affected farmers was the cost of irrigation: although the diesel price dropped as the 2009 financial crisis struck, the 2009 costs of diesel (which powers irrigation in Bangladesh) remained around 30 percent higher than it had been in 2007. Fertilizer smuggling relieved some price pressures, but farmers who bought cheap Indian fertilizer soon found it to be of poor quality. And farmers who invested in expensive fertilizer and seeds at the height of the rice price spike were suffering because rice prices had dropped substantially. The price drop also negatively affected poor people engaged in paddy and rice trading. A further recent change, not associated with economic crisis, was a reported change in production relations, with output-based contract production increasingly replacing the use of daily labor on larger farms. Another livelihood that was affected by the price spike was smuggling. The high demand and high price for fertilizer encouraged a rise in fertilizer smuggling from across the Indian border in 2009. This lucrative, if risky, livelihood was later clamped down on through official measures. But even though fertilizer smuggling remained highly risky, so many local people were drawn into it that local businessmen and landlords reported it had became difficult to find agricultural labor. The 2010 economic recovery in Naogaon took the form of increased agricultural production, mainly because agricultural input costs had come