Bangladesh has registered high growth in dry bulk imports fuelled majorly by infrastructure advancements and construction activities.
The Bangladesh economy is outperforming amongst other South Asian countries in terms of year over year growth in FY 2019. Initially, the country stumbled with negative growth of 14% in 1971 with many challenges ahead, but eventually moved up the ladder with constant uptick in growth to stand at the present stage of GDP growth hovering around 8%.
During slowdown in imports of each south Asian nation, Bangladesh registered high growth specifically for dry bulk imports. There is a substantial rise in bulk vessel (Supramax-class) calls bringing thermal coal, slay, clinker and aggregate stones among others. Bangladesh major port Chittagong has doubled its growth in 2019 against 2018. In 2019, Chittagong port handled 183 bulkers with a growth of 126% from 81 vessels in 2018. The growth fuelled majorly by infrastructure advancements and construction activities.
The country is transforming in terms of infrastructure, manufacturing and industrial expansions. The major construction material that is being imported are a mix of slag, clinker, aggregates, limestone and grains etc. Vietnam and Bangladesh have become two big markets for Supramaxes and Ultramaxes, while keeping largest nations India and China aside.
|Origin Nation||Bulk Commodity||Number of Supramax vessel calls by Year|
|Total Vessels||All commodities||63||81||183|
Hitherto, Bangladesh has been importing coal majorly from South Africa, Mozambique and the Russian Federation, Indonesia has weaned out this market and started exporting coal to Bangladesh from last year. The country imported around 50 Supramaxes of coal through Chittagong port. The rise in import is because of high electricity demand in the country. There are several new power plants commenced operations and few other are in under construction.
The Bangladesh Chinese Power Company Limited built two 660 Mega Watts(MW) power plants in Payra. The first unit went operational in January 2020, and the second unit is expected to commence within four months. The 660 MW Rampal plant aimed to start by end of 2020. The thermal coal shipped from South Africa is mainly used in cement plants.
Beside coal, the next major commodities for rise in bulk traffic are clinker and limestone, which are used for cement making. The country is importing 15 – 20 million tonnes (MT) of clinker and limestone annually. Chittagong port handled 25 Supramaxes vessels from Thailand last year, raised from zero in 2018. Shipments from UAE also bolstered steadily by handling 19 Supramaxes that is more than two fold of the volume recorded in 2018.
The import of grains from Brazil and Ukraine have remained steady over the past 3 years, averaging at around 15 vessels per year. The country ranked fifth in world’s largest wheat importers aided by demand of change in food habits. Black Sea region has become country’s major source for its wheat demand. Country witnessed around 20 % growth in wheat imports, clocking 6 MT in 2019 against 5 MT in 2018.
In contrary to the existing jump in imports growth, the country should also focus on improving export revenue growth by diversifying export commodities in order to narrow the trade deficit for boosting country’s economy to the next level.