Bangladesh on Sunday signed a memorandum of understanding with the United States to import 7 lakh tonnes of wheat annually for the next five years amid the threat of facing 35 per cent US tariff on its exports from the next month.
The US is pressing Bangladesh to reduce the trade gap, which is in favour of Bangladesh, by importing more US products to get a favourable tariff deal. Dhaka is negotiating with Washington for reducing the tariff rate to a tolerable level to safeguard its exports to the US market. Bangladesh is waiting for the third round of tariff talks with the US as the previous two rounds failed to resolve key issues, including the tariff rate.
The MoU was signed by Md Abul Hasanat Humayun Kabir, director general of the Food Department, and Joseph K Sower, vice-president of the US Wheat Association, in the capital Dhaka on Sunday.
Food adviser Ali Imam Majumder told 抖阴精品 that the MoU was not a binding agreement.
鈥楽till, the MoU will provide an opportunity for building trust and a wider area of mutual trade cooperation between Bangladesh and the US amid negotiations over tariff issues between the two trading partners,鈥� he said.
On July 8, US president Donald Trump imposed 35 per cent tariff on Bangladeshi export products, effective from August 1, on top of sectoral tariffs of up to 15 per cent.
The country鈥檚 overall exports to the US were $8.4 billion in 2024, with the readymade garments accounting for $7.34 billion. In the year, the country imported US goods worth $2.2 billion.
The interim government is considering measures to increase imports from the US to reduce the trade gap, Ali Imam said.
He also said the price of wheat would be set later on the government-to-government negotiation.
Bangladesh imports wheat mainly from Russia, Ukraine, Canada, Brazil, Argentina, Australia, but shipments from Ukraine have decreased since the war with Russia began in 2022.
Bangladesh Bank data showed that the country imported wheat worth about $635.8 million in FY24.
Food ministry officials said that the proposed amount of wheat was about 10 per cent of the country鈥檚 annual demand of 70 lakh tonnes with private sector importers such as City Group, Meghna Group, Bashundhara Group, Nabil Group, Sheikh Brothers, and Sainik Group leading the wheat import amid growing demand.
Aminul Islam, managing director of Nabil Group, said that the local private wheat importers were shy of the US wheat market because of high content of protein and relatively high price.
He calculated that fright charge would be additional maximum $3 to $4 per tonne for importing wheat by the government from the US than the other markets.
In the fortnight ending May 9, export prices of the US (Soft Red Winter), the US (Hard Red Winter), Russian, and Ukrainian wheat decreased by 2.9 per cent, 3.1 per cent, 1.6 per cent and 0.8 per cent to $213 a tonne, $240 a tonne, $246 a tonne, and $248 a tonne respectively.
The domestic wheat production has almost halved over the past two decades as farmers shifted to more profitable crops like maize, potatoes, vegetables and boro rice.
In the current financial year of 2025-26, the government has planned to import 15 lakh tonnes of rice and wheat from global markets at an estimated cost of Tk聽7,800 crore. It had imported 10.05 lakh tonnes of rice and wheat worth Tk聽5,800 crore in the past financial year.
Of the proposed import from the international sources, rice will account for 9 lakh tonnes and wheat 6 lakh tonnes.
In 2023, Bangladesh imported wheat worth $823 million. It imported wheat mainly from Canada ($428m), Ukraine ($171m), Romania ($105m), Brazil ($50.7m) and Australia ($45.1m), according to the Observatory of Economic Complexity, an online data visualisation platform under the Massachusetts Institute of Technology.
Earlier on April 3, the US had imposed a steep 37 per cent 鈥榬eciprocal鈥� tariff on Bangladeshi exports, but on April 9, the US president declared a pause on the tariff for three months.
After the pause announcement, Bangladesh had held the first round of negotiations with the US over the tariff rate.
