Why is beef so expensive?

A number of internal and external factors have led to beef being the most expensive in Bangladesh in all of South Asia.

Factors like India banning the export of beef, high population density in Bangladesh and high cost of cattle feed have all led to astronomically high prices.

Just before the Eid-ul-Fitr, the price of beef hovered around Tk650-700 per kilogram, which was Tk600 per kg even in March, a month before.

But now, butchers are retailing beef for Tk700-750 per kg in Dhaka, while mutton costs anywhere from Tk850-1,000 per kg. To put things into perspective, highly prized Australian angus beef retails for $4.90 or Tk400 per kg.

In the Indian city of Kolkata, the price of buffalo meat is Rs200-230 per kg, which is approximately Tk235-270 in Bangladesh, said a Bangladeshi diplomat in Kolkata.

Mutton costs Rs700 per kg there, which is approximately Bangladeshi Tk820.

Consumers could buy one kg of the red meat for Tk 280-300 in February 2015, when the global average prices of beef was $4.63 or Tk 360, based on Bangladesh Bank’s exchange rate at the time. It shows that beef prices in the country were 24 percent lower than the global average.

As the inflow slumped in mid 2015, beef prices shot up. In August, 2015, retail prices in Dhaka were about Tk 400 per kg or $5.14, which was 10 percent higher than then global average of $4.68, according to the World Bank and local market data.

The gap between domestic and global average prices widened even more early this year when meat packers cited higher purchase prices and alleged extortions and hiked red meat prices.

“It begins from the borders,” said Robiul Alam, secretary general Bangladesh Meat Merchant Association.

Traders have to pay extortionists between Tk 10,000 and 12,000 just to bring a cow to the Gabtoli cattle market from the border. Earlier, the illegal toll was much lower, he added.

AFM Asif, chief executive officer of Bengal Meat, said the demand for meat was rising in line with the growth of economy. “But supply is not increasing keeping pace with demand,” he said

Bangladesh annually requires 70.52 lakh tonnes of meat but it could only produce 61.52 lakh tonnes, according to data from Department of Livestock Services (DLS).

Bulk of the domestic requirement for meat is met by poultry, according to industry insiders.
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Asif said cattle rearing was on the rise but it was not adequate to influence the prices yet. Development of breeds to improve per cow meat production was needed, he said.

The DLS data show that Bangladesh had 2.37 crore cattle in the fiscal year 2015-16. However, milk and beef yield per cow was low, said stakeholders.

DLS Director General Md Ainul Haque said more than 5 lakh farmers rear cattle for meat. The DLS brought semen of Brahman breed of cows under a project to develop breeds for beef production. The semen was experimentally given to contract farmers in 80 upazila.

“We see good results,” he said, citing live weight of a bull becomes 600kg in two years whereas live weight of local breed becomes about 200kg at the same age.

He said DLS plans to disseminate the breed in two-three years among mass farmers through artificial insemination.