The agro-food processing industry constitutes an important industry in the manufacturing sector in most countries. This industry is an important part of the manufacturing sector in Bangladesh which now accounts for about 20 per of gross domestic product (GDP) of the country. The agro-food processing industry now contributes about 8.0 per cent to manufacturing output (1.7 per cent of GDP). Despite maintaining sustained growth in output over the last decade or so, its share of GDP remains quite static below 2.0 per cent. This is indicative of the industry’s failure to achieve a higher growth rate relative to other industries, in particular the RMG (ready-made garment) industry which seems to overwhelmingly dominate the manufacturing activity in Bangladesh. According to the UN Food and Agriculture Organisation (FAO), agro-processing involves the transformation of products originating from agriculture, forestry and fisheries. Agro-food processing involves primary and secondary processing. The former is associated with processing of agricultural products in their basic form and the latter requires into final products like jams, biscuits etc. The primary inputs for the industry include crops, poultry and livestock, fishery and some forestry products. This industry now employs about 2.2 per cent of total workforce in the country of which close to 70 per cent are unskilled labor. Its share of total exports now stands at around 1.5 per cent. Some researchers indicate that the country has much higher potential to explore enhancement of exports from this industry as reflected in their estimated revealed comparative advantage (RCA). As the Bangladesh economy continues to grow, the size of the middle-income population will continue to rise. The estimated size of the middle-income population is around 35 million. Also sustained economic growth is causing rapid urbanization. Both sustained economic growth and urbanization have already caused changes in dietary intake where processed food has become an important element in their consumption basket. Furthermore, with the rise of two-income families the demand for processed packaged food is also on the rise. All these factors are now contributing to a rapidly growing domestic market for a whole range of processed food including ready-to-eat meals. But there is also now a market that exists to cater to the needs of rural population where 40 per cent of the country’s people live.
The Bangladesh Agro-Processors' Association (BAPA) is the apex organization representing the agro-processing food industries in Bangladesh. Dedicated to ensuring safe and high-quality food for consumers both at home and abroad, BAPA currently has members exporting to over 144 countries, with an export value of USD 460 million in the fiscal year 2021-2022. With the agro-processing sector growing rapidly, there is great potential for Bangladesh to soon achieve USD 2 billion in exports. The total market size for agricultural products in Bangladesh is USD 47.54 billion, and the agro-processing sector alone contributes USD 5.12 billion in annual turnover. Over the past five years, agricultural exports from Bangladesh have been growing at a compound annual growth rate (CAGR) of 18%, particularly in the processed snacks segment. With global demand for agricultural products expected to grow by 15% between 2019 and 2028, the Bangladesh processed food industry is well-positioned to expand its exports and accelerate the growth and development of the country.
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