US offers agri export credit guarantee to Bangladesh importers

[Black_cats]

US offers agri export credit guarantee to Bangladesh importers

Diplomatic Correspondent | Published: 23:14, Feb 02,2020

https://www.newagebd.net/article/98...port-credit-guarantee-to-bangladesh-importers

The US government on Sunday launched a programme for extending export credit guarantee to facilitate import of US agricultural products by Bangladeshi businesses.

US mission in Dhaka deputy chief JoAnne Wagner launched the programme at a seminar organised by the US Department of Agriculture in Dhaka.

According to USDA officials, the programme offers $5 billion in credit guarantees worldwide each year to support commercial export sales of US agricultural goods to markets, like Bangladesh, that have sufficient financial strength.

Eligible commodities for the programme includes cotton, textile fibres, live animals, edible meat, fruits, cereals, oilseeds, sugar, organic chemicals, wood and articles of wood, wool, paper and paperboard.

It is a quadrilateral programme involving an importer in Bangladesh, a local bank in Bangladesh, a local bank in the US and an exporter in the US, under which the US will extend guarantees for payment for purchases of US food and agricultural products by importers in Bangladesh.

The programme has mainly been announced to protect the US exporters from non-payment by foreign banks, enhance borrowing capacity to overcome cash flow constraints by assigning credit guarantees to eligible US financial institutions, and develop and maintain business in new markets.

Participating local bank in Bangladesh can access US dollar financing for up to 12 months from the US banks at potentially lower interest rates to facilitate the trade.

Bangladesh is one of about 130 countries eligible for the credit guarantee programme.

USDA officials Maria Dorsett and Elisa Wagner spoke on the occasion.

US embassy agriculture attaché Tyler Babcock hoped that many banks in Bangladesh would enrol in the programme.

 

[Bilal9]

We can buy plenty of cheap Soybean and Corn from the US but what would we use it for? Not in our diet unlike the Chinese...everything the US offers, we produce. Except maybe Apples and Plums, which would spoil in the time they get shipped over....

There could be some use of grain and fruit flour used in the processed food and confectionery industries.

One thing I see some hope for is dried fruit like especially de-hydrated fruit - and raisins and dates of Medjool variety (produced in the California desert) during Ramjan. US Dates actually get exported to Saudi and Gulf, as they are pretty high quality and well packaged.

 

[KAL-EL]

We are always open to new opportunities with Bangladesh.

 

[Bilal9]

We are always open to new opportunities with Bangladesh.

Well 160 Million people are not a small customer base, that is for sure.

In fact the middle class folks in Bangladesh alone probably outnumber a lot of middle class people in supposedly 'rich' Western countries. UK has 63 million people, among them 25% middle class, or about 16 million people. In Bangladesh, 27 Million people (out of 160 million plus total) are considered middle class. Even considering income differentials (let's say half of these people), Bangladeshi people (per common knowledge) are considered bigger spenders on food and entertainment, certainly more so than neighboring India.

These people are all possible customer-candidates of US agri products. So yes there is scope for US business.

 

[TopCat]

We can buy plenty of cheap Soybean and Corn from the US but what would we use it for? Not in our diet unlike the Chinese...everything the US offers, we produce. Except maybe Apples and Plums, which would spoil in the time they get shipped over....

There could be some use of grain and fruit flour used in the processed food and confectionery industries.

One thing I see some hope for is dried fruit like especially de-hydrated fruit - and raisins and dates of Medjool variety (produced in the California desert) during Ramjan. US Dates actually get exported to Saudi and Gulf, as they are pretty high quality and well packaged.

We import a lot of cotton. Recently we are importing live animals

 

[cloud4000]

So US is pushing its agro products to Bangladesh now, including providing financing facilities to importers?

It’s fine as long as it doesn’t undermine Bangladesh’s own agricultural economy. US heavily subsidized its farmers to the tune of billions of dollars and then helps export it to countries and undercut their own farmers.

Bangladesh should be careful.

 

[TopCat]

So US is pushing its agro products to Bangladesh now, including providing financing facilities to importers?

It’s fine as long as it doesn’t undermine Bangladesh’s own agricultural economy. US heavily subsidized its farmers to the tune of billions of dollars and then helps export it to countries and undercut their own farmers.

Bangladesh should be careful.

USA does not grow what we grow. We will be more than happy to import subsidized wheat, cotton, soy etc.

 

[Homo Sapiens]

USA does not grow what we grow. We will be more than happy to import subsidized wheat, cotton, soy etc.

But shipping cost and duration would be prohibitive.

 

[Bilal9]

But shipping cost and duration would be prohibitive.

Bulk shipping cost for agri items is actually pretty cheap. Wheat etc. is imported in 1 or 2 ton Bulk bags which are lifted and put in trucks by hoists which are then put in ship holds in containers or by themselves.

http://bycom.net/wp-content/uploads/2015/09/bottom.jpg

Even US grains like corn and soybean could be imported to Bangladesh in open bulk ship holds. We could process this locally to get fresh Soybean or corn oil which are big items in Ramjan. Also - the Soymeal or cornmeal left after crushing (Khoil) could be used as animal feed such as Chicken feed and mixed with cow feed.

Shipment time to CTG is maximum 65-70 days from various US ports, which precludes fresh fruit. But vacuum packed dried fruits like dates, bulk pulses, and grains like Soybean/corn etc. will be fine.

This is how Soybean and corn is loaded into bulk holds of ships.

The US Soybean exports are in tough spot since the onset of tariff imposition by China, the US is trying to diversify its Soybean export destinations which includes Bangladesh.