59 Food inflation and the cost of living

Chapter 59 of 60 in the Bangladesh 2036 research base. Contents of the series.

Food inflation moved the burden, not just the headline, and the decade turns on who eats the adjustment

Chapter 05 owns the monetary story of the 2022 to 2026 inflation regime; this chapter takes it one level down, to the basket where the burden landed. The thesis is threefold. First, food inflation did not lead the spike, it absorbed and held it: non-food inflation led in FY23 at 9.39 percent against 8.71 percent for food [BBS CPI 2023], by March 2024 food had overtaken non-food at 9.87 against 9.64 percent [BBS CPI 2024], and for the full year FY24 food averaged 10.66 percent while non-food fell to 8.86 [BB AR 2024, section 3.06], the sequence of an exchange rate shock absorbed last and longest in the items the poorest households buy most. Second, the basket tells a mechanism story the syndication headlines do not: the import-linked lines moved with import parity in both directions through the floating taka, rice behaved like the domestic crop it is, and onions spike every November on storage losses and the import window, a seasonal structure no single cartel requires. Third, the decade question is distributional: the bottom 40 percent of the consumption distribution held 21.60 percent of it at the last survey [WB WDI 2022, decile shares] and the cost of a healthy diet reached 160.36 BDT per person per day in 2025 [FAO 2026], so the fight over who eats the disinflation, indexed transfers or a quiet real wage cut, is the decade's cost of living fight to FY36, the horizon chapter 15's scenarios assume.

The record: food caught up with non-food and finished FY24 ahead of it, with the burden on the import-linked lines

Fiscal years run July to June. The record has two regimes and a handover. In the first, food inflation sat at 6.05 percent in FY22 and the general rate at 6.15 [BBS CPI 2023]. In the second, the general rate jumped to 9.02 percent in FY23 while food, at 8.71, still trailed non-food at 9.39 [BBS CPI 2023]; chapter 05 reads the sequencing as an imported, exchange rate shock's fingerprint. The handover shows in the monthly panels: in January 2023 food ran at 7.76 percent against non-food at 9.84; by March 2024 food printed 9.87 against 9.64, with the general rate at 9.81 [BBS CPI 2023] [BBS CPI 2024]. The burden is geographic as well as nutritional: in March 2024 rural general inflation ran at 9.68 percent and urban at 9.94, while rural food at 9.86 and urban food at 9.98 sat above their own headline rates in both sectors [BBS CPI 2024, series panel food lines], the inflation a rural household could not trade out of.

FY24 completed the overtaking. The 12 month average food inflation rose through the year to 10.66 percent in June 2024 while non-food fell to 8.86, and point to point food stayed above 9.0 percent every month, closing at 10.42 [BB AR 2024, section 3.07]; the general rate of 9.73 for FY24 against the 7.50 revised target was by then a food phenomenon [BB AR 2024, section 3.04]. Beyond FY24 the food specific record goes dark in the sources available to this chapter: monthly panels end at March 2024, so the FY25 and FY26 food prints could not be confirmed pending BBS releases, the measurement gap chapter 53 carries. What the general series shows is a regime that did not break: 9.88 percent in calendar 2023 and 10.47 in calendar 2024, easing to 8.77 in calendar 2025, the most recent reading [WB WDI 2026], with the IMF projecting an average of 9.2 percent for FY26 [IMF WEO 2026]. Compounding the three sourced food prints lifts the food price level 27.6 percent across FY22 to FY24 alone, chapter arithmetic; extending that figure with the calendar general rate or the IMF's fiscal year projection would compound a fiscal food series against a calendar and a forward looking series on different bases, so this chapter stops the food price index at FY24 and treats anything beyond it as not established.

The item level record splits the basket in two. The staple behaved: coarse rice rose from 42.55 BDT per kg in June 2021 to a peak of 53.49 in July 2025 and stood at 49.98 in April 2026, up 17.5 percent across five years [HDX WFP 2026], chapter arithmetic. The import-linked and perishable lines carried the regime. Wheat flour rose from 33.29 BDT per kg in January 2021 to 54.44 in April 2026, up 63.5 percent [HDX WFP 2026]. Palm oil rose from 98.93 BDT per litre in January 2021 to a 2022 shock peak of 169.14 in May 2022, up 71 percent in sixteen months, eased to the 120s and 130s through 2023, then climbed past that peak to a new high of 170.33 in November 2025, before easing to 157.37 in January 2026 and back to 167.14 by April 2026 [HDX WFP 2026]. Soybean oil fell from 170.62 BDT per litre in February 2024 to 152.59 in September 2024, then climbed from 171.66 in January 2025 to 190.32 in November 2025, up 10.9 percent in ten months while the taka held inside a two percent band [HDX WFP 2026] [BIS 2026]. Lentils rose from 71.62 BDT per kg in January 2021 to a peak of 116.71 in January 2024, then fell back to 93.52 by February 2026 [HDX WFP 2026]. Onions ran the seasonal saw: 63.45 BDT per kg in February 2024, 115.00 in November 2024, back to 64 to 68 through spring 2025, then 105.83 in November 2025 [HDX WFP 2026].

The household face of those series is measured, not anecdotal. In December 2024, 47.91 percent of households reported being affected by the higher food prices shock on the FAO panel; by August 2025 the share was 27.12 percent [FAO 2026]. The cost of a healthy diet rose from 111.8 BDT per person per day in 2021 to 148.21 in 2024 and 160.36 in 2025, up 43.4 percent in four years [FAO 2026], while the share unable to afford that diet fell from 47.2 percent in 2021 to 40.4 in 2024 and 38.6 in 2025 [FAO 2026]. Both facts matter: eating well got 43.4 percent more expensive while average incomes outran it; whether the bottom of the distribution did is what the wages versus prices arithmetic below answers.

Mechanism: import parity cuts both ways through the float, rice stayed a domestic crop, and the onion spike is a storage and import window problem

The first mechanism is import parity through the exchange rate. The taka went from 85.8 per USD at the end of 2021 to 117.7 in May 2024 when the float was introduced and 122.9 by May 2025, a depreciation of about 43 percent, chapter 05's arithmetic [BIS 2026]. A country importing most of its edible oil and wheat cannot run food prices independent of that move. Chapter 16 records the dependency: palm oil imports worth 1.5 billion USD and soybean oil 0.9 billion in 2021 [BACI 2024], with the import unit price index for edible oil at 520.53 on the 2002-03 base of 100 in 2023 [BBS Agri 2024]. The retail series shows pass-through working in both directions once the float came: lentils fell 19.9 percent from their January 2024 peak to February 2026 as global pulses prices normalised, palm oil round-tripped down through 2023 and back up to a new high by November 2025 as global vegetable oil prices moved, and wheat flour was slipping by early 2026 [HDX WFP 2026]. This two-sidedness argues against reading every retail move as a margin story: a syndicated market does not return 20 percent to consumers.

The second mechanism is rice's good behaviour, the domestic crop's fingerprint. Coarse rice retail rose 17.5 percent across June 2021 to April 2026 against a food price level up 27.6 percent in FY22 to FY24 alone [HDX WFP 2026], chapter arithmetic. The production side explains why: a record harvest of 42.06 million tonnes in FY24 [BBS Agri 2024], with the irrigated boro season at 53.3 percent of output [BBS Agri 2024], chapter arithmetic, kept the staple's supply ahead of population even as its cost of production rose with diesel at 120.25 BDT per litre in the latest snapshot [HDX WFP 2026] and with the fertiliser bill chapter 16 details. The producer price record: rice fetched 30,324.2 BDT per tonne at farm gate in December 2023, about 30.3 per kg, against 47.30 BDT per kg retail the same month [FAO 2026] [HDX WFP 2026], a wide but stable spread of roughly 1.6 times, the signature of ordinary margins. Rice inflation in this regime was cost push from irrigation diesel and the lean season calendar, not scarcity.

The third mechanism is the onion line, where the syndication claims concentrate. Domestic onion production rose from 1.80 million tonnes in FY19 to 2.75 million in FY24, up 52.5 percent [BBS Agri 2024], yet retail spiked above 100 BDT per kg in November 2024 and again in November 2025 [HDX WFP 2026]. Farm gate spiked the same way a year earlier, 110,786.5 BDT per tonne in November 2023, about 110.8 per kg [FAO 2026], locating the 2024 and 2025 retail spikes in the same structure. The structure has three parts: heavy storage loss after the winter harvest, an import option swinging on Indian export policy each October to December, and a trade sized to neither. The import risk is a matter of record: the Ministry of Commerce annual report records that India abruptly stopped onion exports, that domestic prices rose abnormally as a result, and that the ministry planned 150,000 tonnes of TCB purchases in response [MoC 2021]. The pattern is seasonal concentration on a thin market, not a permanent mark-up: after every spike, prices returned to the 60s and 80s within one to three months, which no durable cartel would allow [HDX WFP 2026]. The syndication claims are right in effect and wrong in mechanism: traders holding cold storage and import licences do capture the spike rents, but the rent exists because storage and import institutions are thin; the remedy is storage capacity and a rule based import window, a competition and investment problem chapters 48 and 16 own. No stored evidence available to this chapter quantifies a syndicate premium, and any figure for one is not established.

The fourth mechanism is the state's own footprint, on both sides of the basket. On the input side, the fertiliser subsidy peaked at 24,500 crore BDT in FY24 before settling at 16,500 in FY25 [MoF Subsidy 2025], a fiscal socialisation of farm cost chapters 16 and 41 also read. On the consumer side the instrument is the Trading Corporation of Bangladesh, and the ministry's reports let its scale be stated rather than asserted. Over March 2020 to June 2021 TCB sold 77,289 tonnes of soybean oil, 68,471 of onions, 55,355 of sugar and 24,951 of lentils through 87,523 truck sales, reaching about 35 million families at 400 per truck [MoC 2021]; in the FY21 onion programme it bought 73,000 tonnes and sold 65,820 between September 2020 and March 2021, about 2.9 percent of the FY21 crop [MoC 2021] [BBS Agri 2024], chapter arithmetic. In FY22 it sold 69,900 tonnes of soybean oil, 68,325 of lentils, 62,962 of sugar and 17,030 of onions to 47.28 million beneficiary family contacts under a 10 million household family card programme [MoC 2022]; its onion sales that year were about 0.7 percent of the FY22 crop, chapter arithmetic. On enforcement, the Bangladesh Competition Commission filed cases against 12 institutions under the Competition Act 2012 over abnormal edible oil price increases and artificial scarcity, the market where soybean oil rose 10.9 percent in ten months of 2025 [MoC 2022] [HDX WFP 2026]. The state's consumer side tools are real and documented, and an order of magnitude too small to move any price line here.

The fifth mechanism is wages, and it is where the regime's cost lands. The national wage rate index rose from 180.83 in FY21 to 205.30 in FY23, about 6.6 percent a year, chapter arithmetic, roughly tracking food inflation until the regime's second year [BBS Wage 2024]. Then the lag opened: in March 2024 the index grew 7.80 percent general and 8.19 in agriculture against food inflation of 9.87 percent national and 9.86 rural [BBS Wage 2024] [BBS CPI 2024, series panel rural food], so a farm wage earner lost real income at about 1.5 percent a year in the regime's third year, agricultural wage growth against rural food inflation. Construction wages tell the same story in levels: a mason in Dhaka earned 558 taka per day in FY20 and 590 in FY22, up 5.7 percent across two fiscal years against food inflation of 8.71 percent in FY23 alone [BBS Wage 2024] [BBS CPI 2023]. The board set floors did not catch the gap either: the garment minimum moved to 12,500 taka per month in December 2023 [ILO 2026, EAR_INEE_NOC_NB_A], a settlement chapter 58 shows is already eroding in real terms. The exposure is distributional: the bottom 40 percent of the consumption distribution held 21.60 percent of consumption in 2022, essentially unchanged from 21.31 in 2010 [WB WDI 2022, decile shares], the income Gini stood at 0.499 with the bottom five percent of earners holding 0.37 percent of recorded income [BBS HIES 2022], and since food is a larger share of a poorer household's budget, the 27.6 percent food price rise is a regressive tax the headline index never displays.

The problem stated plainly: the FAO healthy diet standard cost 160.36 BDT per person per day in 2025 [FAO 2026], so a three person household eating that diet spends about 14,432 BDT a month on food alone, chapter arithmetic, which exceeds the 12,500 taka per month garment minimum wage [ILO 2026, EAR_INEE_NOC_NB_A] before rent, transport, fuel, education or illness. The standard is a reference basket, not actual spending, and food inflation decides how far the floor wage and diet sit apart.

The decade ahead: four decisions decide whether disinflation reaches the plate

The disinflation path is the IMF projection of 9.2 percent for FY26 [IMF WEO 2026] and, beyond that, an assumption rather than a projection: the chapter 15 scenarios assume the reform path reaches the neighbourhood of the 6 percent budget target by around FY28, the baseline nearer FY30, and the stall reverts above 10 percent. This chapter's contribution is food specific leverage: food inflation has run at or above headline since early 2024, so headline disinflation to 6 percent needs food disinflation below it, via global price help, a stable taka, or margins compressing. All three happened partially in 2025: the headline fell to 8.77 percent for the calendar year, already below the IMF's own 9.2 percent FY26 average projection [WB WDI 2026], though still about 2.8 percentage points above the 6 percent budget target the scenarios assume.

Four decisions decide it. The staple trade decision, owned by the Ministry of Commerce with chapter 16's procurement record, is whether rice and onion import windows become rule based, published against stock and price thresholds, or stay discretionary, the design behind the November spikes and their rents; the FY21 report shows the response to the last Indian ban was an emergency 150,000 tonne TCB programme [MoC 2021], a reaction, not a rule. The competition decision, shared with chapter 48's enforcement institutions, is whether the edible oil chain gets a margin inquiry with compulsory data reporting from refiners, building on the Competition Commission's 12 cases, or another round of mobile court fines without a data base [MoC 2022]. The indexation decision, owned by chapter 34's transfer architecture and chapter 58's wage boards, is whether allowances and the next minimum wage rounds are set against the food CPI with a published formula; this chapter adds the measurement trigger, the fourth decision. The measurement decision, owned by chapter 53's statistics account, is whether the BBS monthly food CPI, rebased to 2021-22 and published on schedule, becomes the public reference series, because every other decision here indexes to that print; the record available to this chapter, ending at March 2024, shows how thin that trail is. No official projections of the food price level to FY36 exist, and no specific FY36 figure here is established; the IMF's Article IV path, the World Bank's food security updates and the FAO's diet cost series would fill that gap [FAO 2026].

Three risks re-run the record's own series, and the upside is already visible inside two of them

Risks. First, a subsidy inflation spiral: if world fuel and fertiliser prices spike again while the taka weakens, the choice between the 24,500 crore BDT subsidy peak of FY24 [MoF Subsidy 2025] and cost reflective input prices becomes an inflation decision, since both feed rice's cost push channels; the revealing indicator is the fertiliser budget line against the import price index chapter 16 tracks at its 1,167.76 peak in 2023 [BBS Agri 2024]. Second, the seasonal spike re-run: the onion pattern of November prints above 100 BDT per kg in 2024 and 2025 [HDX WFP 2026] is live, and a third consecutive November above 100 would confirm the storage and import window structure as the decade's recurring tax on the poor; the revealing indicator is the November retail print against the preceding import announcement. Third, real wage erosion as a regime: if wage rate index growth stays below food inflation for two consecutive years, the catch-up never comes and the minimum wage rounds of chapter 58 renegotiate against a permanently higher price level; the revealing indicator is the March wage rate index growth against the March food CPI, currently 7.80 against 9.87 percent [BBS Wage 2024] [BBS CPI 2024].

Upside. First, the two-sided pass-through is already paying: lentils at 93.52 BDT per kg in February 2026, 19.9 percent below their January 2024 peak [HDX WFP 2026], show the float passing global normalisation to retail, which the old peg blocked; the revealing indicator is soybean oil retail leaving the 188 BDT per litre level for 160 or below. Second, indexation with a measured trigger: if chapter 34's allowance formula and the wage board rounds anchor to the published food CPI, the burden of any future spike is shared on a rule rather than absorbed by the bottom 40 percent [WB WDI 2022, decile shares]; the revealing indicator is the next allowance repricing date against the print that moves it. Third, the unaffordability trend: the share unable to afford a healthy diet fell from 47.2 percent in 2021 to 38.6 in 2025 [FAO 2026] even as the diet cost rose 43.4 percent, so income growth outran food prices for the population on average; if that continues, the revealing indicator is the unaffordability share breaking below 35 percent, and the regime change it would mark is growth, not price policy, doing the work.

What to watch: five indicators whose thresholds mark the cost of living regime

1. Monthly national food CPI. Current value: the FY24 annual average of 10.66 percent is the last full year print [BB AR 2024, section 3.06], and 9.87 percent in March 2024 is the last stored monthly print [BBS CPI 2024]. Threshold: sustained monthly prints below 6 percent confirm disinflation reaching the basket; any print back above 10 percent marks the second round regime the stall scenario assumes.
2. Coarse rice retail. Current value 49.44 BDT per kg in the indicator snapshot of 4 September 2026; the April 2026 monthly print is 49.98 [HDX WFP 2026]. Threshold: above 55 BDT per kg in the July to October lean season signals a harvest or trade policy failure of the kind chapter 16 flags; below 45 BDT per kg signals the production plateau turning to surplus.
3. Soybean oil retail. Current value 188.38 BDT per litre in the indicator snapshot of 4 September 2026; April 2026 is 188.22 [HDX WFP 2026]. Threshold: a fall below 160 BDT per litre signals global pass-down or margin normalisation; a print above 200 reopens the administered pricing and margin inquiry question of 2025.
4. Cost of a healthy diet and its unaffordability share. Current value 160.36 BDT per person per day and 38.6 percent unable to afford it in 2025 [FAO 2026]. Threshold: the share back above 40 percent, where it stood as recently as 2024, marks a real income reversal; below 35 confirms average incomes outrunning the food basket.
5. Wage rate index growth against food inflation. Current value 7.80 percent general and 8.19 percent agriculture in March 2024 against food inflation of 9.87 percent the same month [BBS Wage 2024] [BBS CPI 2024]. Threshold: two consecutive years of index growth below food inflation marks the erosion regime; index growth above food inflation marks the catch-up that would make the next wage round of chapter 58 a settlement rather than a confrontation.

Sources used

[BBS CPI 2023] BBS CPI annual averages via bdpolicy.db, series: bbs_inflation_national_general, bbs_inflation_national_food, bbs_inflation_national_non_food. [BBS CPI 2024] BBS CPI monthly national, rural and urban panels via lake/prices/bbs_cpi_monthly_sector_panel.parquet, January to March 2024, series: bbs_inflation_national_general, bbs_inflation_national_food, bbs_inflation_national_non_food, bbs_inflation_rural_general, bbs_inflation_urban_general. [WB WDI 2026] World Bank CPI inflation, calendar annual averages, series: FP.CPI.TOTL.ZG, via indicators/wb_full_bd.parquet for 2022 to 2024; calendar 2025, absent from that parquet, via the World Bank API, accessed 2026-09-06. [WB WDI 2022] World Bank Poverty and Inequality Platform Bangladesh extract via the wb_pip_bd parquet, consumption decile shares. [IMF WEO 2026] IMF WEO snapshot via bdpolicy.db, series: imf_cpi_inflation_avg, FY26 average inflation projection. [BB AR 2024] Bangladesh Bank Annual Report 2023-24 via ocr_text/bb/annual_report: section 3.04, FY24 general 9.73 percent against the 7.50 revised target; section 3.06, food 10.66, non-food 8.86; section 3.07, point to point food 10.42. [BIS 2026] BIS USD/BDT monthly series via bdpolicy.db, series: bis_usd_bdt_monthly_eop, end 2021 to May 2026. [HDX WFP 2026] WFP food and fuel price monitoring via bdpolicy.db, series: wfp_price_rice_coarse_bdt_kg, wfp_price_wheat_flour_bdt_kg, wfp_price_lentils_masur_bdt_kg, wfp_price_oil_palm_bdt_l, wfp_price_oil_soybean_bdt_l, wfp_price_onions_bdt_kg, plus the indicator snapshot updated 2026-09-04: hdx_wfp_rice_coarse_price, hdx_wfp_oil_soybean_price, hdx_wfp_fuel_diesel_price. [FAO 2026] FAO via bdpolicy.db: fao_producer_price_rice_bdt_tonne, fao_producer_price_onions_bdt_tonne, fao_diet_cost_bdt_per_day, fao_diet_unaffordability_pct, fao_diem_income_shock_food_prices_pct. [BBS Agri 2024] BBS agriculture series via bdpolicy.db: bbs_onion_production, bbs_rice_total_production, bbs_rice_boro_production, bbs_tot_import_price_edible_oil, bbs_tot_import_price_fertilizer. [BACI 2024] CEPII bilateral trade at HS6 via TradeWeave parquet, HS chapters 15 and 10. [MoF Subsidy 2025] Finance Division agricultural subsidy allocations via the bdfacts_sector snapshot in bdpolicy.db, series: bdfacts_agri_subsidy_fertilizer_bdt_crore, FY21 to FY25, cross-checked against press reporting of the FY24 revised agriculture subsidy, 2026-09-06. [BBS Wage 2024] BBS wage series via bdpolicy.db and lake/labor/bbs_wage_rate_index_divisional_panel.parquet, wage rate index levels and March 2024 growth, daily construction wages, series: bbs_wage_mason_dhaka. [BBS HIES 2022] BBS HIES 2022 via bdpolicy.db, series: bbs_hies_gini_national, bbs_hies_income_bottom5_share. [ILO 2026] ILOSTAT minimum wage series EAR_INEE_NOC_NB_A via the ILOSTAT API rplumber.ilo.org. [MoC 2021] Ministry of Commerce annual report FY2020-21 via ocr_text/moc_bd: TCB truck sales March 2020 to June 2021 by item, the FY21 onion programme of 73,000 tonnes bought and 65,820 sold, the recorded Indian onion export ban. [MoC 2022] Ministry of Commerce annual report FY2021-22 via ocr_text/moc_bd: TCB FY22 sales by item and beneficiary family count, the 10 million low income family card programme, the Competition Commission edible oil cases under the Competition Act 2012.

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Verified line by line against primary sources: 52 claims checked, 12 corrected.

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