Major rice traders admit to duping consumers by selling fake Miniket, Najirshail rice

The Competition Commission last week sued 44 companies producing and distributing essential commodities on charges of destabilising the market by raising prices abnormally.

Representatives of major rice suppliers in the country have admitted to selling over-polished coarse varieties of rice by rebranding them as popular varieties like Miniket and Najirshail. 

The admission came on the second day of a public hearing at the Bangladesh Competition Commission. A four-member panel, led by the commission’s Chairperson Md Mofizul Islam, conducted Tuesday’s hearing. 

The commission, an autonomous judicial authority which ensures fair competition in the market, organised the proceedings to hear from the representatives of six firms, involved in the production and marketing of rice, flour, egg, chicken and toiletries, on charges of “destabilising the market by abnormally raising prices of essential commodities with the intention to profiteer”. 

The firms are Bangladesh Edible Oil Limited, Rashid Agro Food, Belcon Group, City Group, Paragon Poultry and Unilever Bangladesh. 

The representatives, however, have sought extensions to come up with information regarding operating and production costs and methods they follow to set retail prices the panel asked for at the hearing.

A government study last year found that all varieties of Miniket rice and most of the Najirshail varieties found on the market across Bangladesh are over-polished coarse varieties of rice. 

The traders and millers collect different varieties of coarse paddies or rice and polish them before marketing them as Miniket and Najirshail varieties, capitalising on people’s preference for fine white rice, the study concluded. 

The Competition Commission last week sued 44 companies producing and distributing essential commodities. Apart from ensuring fair competition, the commission has the authority to register cases at production, supply, retail or consumer levels, or file cases on its own in line with the law. 

BANGLADESH EDIBLE OIL COMPANY

 The representative of the firm, widely known as a cooking oil company, conceded that the company over-polishes BR 28, BR 29 and Kataribhog varieties of rice and sells those as Miniket varieties since the name Miniket has “market value.” 

The company, according to the representative, markets two brand names, Veola and Rupchanda. The Rupchanda brand, according to the company, is for high-end consumers. 

The representative was asked if he could confirm which variety of rice they market under each brand, but he failed to come up with an answer.

In its defence, however, the company said they are essentially acting as a distributor as they collect rice from the millers, package it and sell it in the retail market as the company was issued a licence to sell rice. 

The panel asked the company to come up with more information about their production costs and retail costs by Oct 13.

 RASHID AGRO FOOD 

Rashid Agro’s National Sales Manager Shaikh Shahiduzzaman represented the company at the hearing. 

Confirming that the company holds a 5 percent share in the rice market, Shahiduzzaman admitted they sell BR 28 breed of rice in Cumilla region as BR 28 while the same rice is sold in Gazipur as Njirashail. 

“We do it because consumers in different regions are familiar with different names they prefer,” he said at the hearing. 

Shahiduzzaman also conceded that the commission’s allegation about abnormally raising prices of rice is somewhat true, but he defended the move citing growing dependency on power generators due to intermittent power cuts and a rise in transportation costs due to recent fuel price hikes. 

The panel asked Shahiduzzaman to come up with more information about the company’s sales on Oct 13. 

BELCON GROUP 

Jafrul Alam, an executive officer of the Belcon Group, represented the company at the hearing. 

The company, which sells rice under the Rajanigandha brand, failed to produce any supporting evidence in favour of its rice price hike. The panel also asked the group to produce more information on Oct 13. 

Belcon Group has also been asked to open their books for the last three fiscal years and submit specimens of different varieties of rice they market. 

CITY GROUP 

The company, which sells Miniket, Najirshail and Kataribhog varieties under the Teer brand, has failed to produce any corroborating evidence to justify its recent price hike. 

The panel also asked the group’s representative Bishwajit Saha to present more information on Oct 13. 

The company also received an identical extension in another case of price manipulations of flour. 

Meanwhile, Unilever Bangladesh, too, was given an extension until Oct 16 to provide more information after the company’s legal representative Mostafizur Rahman Khan asked for more time. 

The commission opened the hearings on Monday with Kazi Farms, which is accused of destabilising the egg and chicken markets. 

Kazi Farms failed to provide necessary information during the hearing and it got until Oct 6 to prepare the records. 

Commodity prices have increased rapidly across the globe due to the Russia-Ukraine war amid heightened demand during the recovery from the coronavirus pandemic. 

In Bangladesh, the prices of rice, soybean oil, sugar, cosmetics and toiletries, egg, chicken and other commodities have surged abnormally, prompting the authorities to check whether the companies raised the prices for proper reasons. 

The Directorate of National Consumer Rights Protection found irregularities leading to price hikes of some products. It held meetings with representatives of the companies and merchants. 

The commission looked into the irregularities spotted by the directorate and reports of market manipulation before filing 44 cases. 

Most of the cases were filed against businesses involved in the rice trade, including 11 big organisations and eight corporate firms. 

The others include eight involved in flour production and supply, six in egg production, six in broiler chicken production and marketing, and six in the production and marketing of soap and detergent. 

OTHERS ON THE LIST 

The others named in the cases over rice prices include Md Abdul Hannan of Zahura Auto Rice Mill in Dinajpur, Md Erfan Ali of Erfan Group in Chapainawabganj, Golam Kibria Bahar of Kibria Agro Industries Ltd in Bogra, Toufiqul Islam Babu of Mofizuddin Automatic Rice Mill in Naogaon, Alal Ahmed of Alal Agro Food Products in Bogura, Zahirul Khan Islam, proprietor of Nurjahan Agro Foods industries Ltd in Brahmanbaria, Putu Mia of Auto Rice Mill, Arshad Ali of Dada Auto Rice Mills in Kushtia and Brajen Majumder of Majumdar Auto Rice Mill in Naogaon. 

Those named in the cases over rice prices also include the chairmen of Square Food & Beverage Ltd, ACI Limited and Mabco High-tech Rice Industries Ltd, the chairman or managing director of BRAC Seed and Agro Enterprise and City Auto Rice & Dal Mills Ltd of Narayanganj, the managing director and CEO of PRAN Foods Ltd. 

The managing director of Meghna Group of Industries, the chairman of Akij Group, and the managing directors of Bashundhara Group, ACI Limited, TK Group, Nurjahan Group and S Alam Refined Sugar Industries Limited will face hearings for an abnormal hike in flour prices. 

The CEO of CP Bangladesh Co Ltd, the managing director of Diamond Egg Ltd, and the proprietor of Peoples Poultry Feed Limited are named in cases related to the egg business. 

The director of Suguna Food and Feeds Bangladesh Private Limited, the managing director of Alal poultry and Fish Feed Ltd, the director of Nourish Poultry Hatchery Limited, and the president of CP Bangladesh Co Ltd, who are associated with the chicken business, have been sued over chicken prices. 

Those sued for the hike in the prices of toiletries or soap and detergent are the chairman of ACI Limited, the chairman or managing director of Square Group, and the chairmen or managing directors of Kohinoor Chemical Company (Bangladesh) Limited and Keya Group.