Powerful syndicates are manipulating prices, controlling supply and influencing market trends, affecting both small businesses and consumers in the wholesale markets, and this is happening despite strict government actions, according to market insiders.
Authorities responsible for monitoring the wholesale market, which plays a crucial role in the supply chain, ensuring goods reach retailers and consumers, have failed to curb these practices, said retailers and consumers.
Wholesale markets act as intermediaries between producers—such as farmers or manufacturers—and retailers. Goods arrive in bulk and are distributed further down the supply chain. Ideally, these markets should function on the principles of supply and demand, but syndicates often disrupt this balance.
The players manipulating the market remain untouchable due to their political influence.
How Syndicates Operate
Syndicates, often comprising influential traders, large-scale wholesalers, and transporters, exploit market dynamics by creating artificial shortages, hoarding goods, and manipulating auctions to sustain high profit margins. Operating with minimal oversight, these networks wield significant control over prices and product availability.
Retailers claim that groups of wholesalers agree on fixed prices, preventing competition and ensuring higher profits. Besides, traders stockpile essential goods, causing artificial shortages that drive prices up.
With a few dominant players controlling the entire supply chain and sidelining smaller traders and new entrants, consumers say that regulatory bodies and enforcement agencies often turn a blind eye due to alleged bribes and political pressure.
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Retailers, especially small shop owners, are forced to buy at inflated prices, leading to increased costs for consumers. Essential commodities such as vegetables, grains, and fuel are often subject to syndicate control, making affordability a major concern.
Weak Enforcement and Limited Reforms
Authorities periodically launch crackdowns against market syndicates, but these efforts often fail due to deep-rooted corruption and lack of sustained enforcement. Price monitoring mechanisms exist, but enforcement remains weak.
Some countries have introduced digital marketplaces and direct farmer-to-consumer supply chains to break monopolies, but results vary.
In Bangladesh, Krishak Oikyo Parishad has launched sales points in different areas of the country, including Dhaka, where farmers sell their products directly to consumers. Leaders of the organisation say their platform aims to ensure fair prices for farmers, who often struggle to receive equitable compensation for their produce.
Krishak Oikyo Parishad has also called on the government to implement measures that guarantee fair prices for farmers' products. They advocate for direct producer-to-consumer sales to eliminate middlemen’s excessive profits and raise their voices when agricultural prices drop in the market.
Who is Responsible?
Visiting different wholesale markets in Dhaka, the UNB correspondent found that middlemen and commission agents, rather than direct producers or traders, control the distribution process.
Retailers claimed these middlemen take high commissions based on market conditions, raising prices for both retailers and consumers.
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Large-scale wholesalers and traders form cartels to control pricing, stockpile goods, create artificial shortages, fix prices, and often force smaller traders and retailers to buy at inflated rates. Some major retailers also contribute by negotiating deals with wholesalers that exclude small traders. This limits market competition and strengthens the syndicate’s grip.
Wholesale market committees and associations claim to regulate trade. But, some of these groups function as part of the syndicate, enforcing price manipulation and restricting new entrants.
Transport unions and logistics providers sometimes collaborate with syndicates by delaying shipments, increasing freight costs, or blocking direct supply from producers to retailers.
Corrupt government officials and inspectors allow syndicates to operate freely. Weak regulation and bribery enable hoarding and price manipulation in exchange for financial or political favours. Political figures with ties to wholesale markets benefit from syndicate operations, using their influence to protect these networks from legal action.
Who Suffers the Most?
Breaking these syndicates requires stronger regulations, digital market systems, and direct producer-to-consumer supply chains. But, without strict enforcement, these hidden forces will continue to dominate the wholesale market, small business owners said.
Small retailers cannot buy at competitive rates. Farmers and producers are forced to sell at low prices while end consumers pay high rates. As a result, consumers face inflated prices for basic goods.
A View of Dhaka’s Wholesale Markets
Dhaka, the capital of Bangladesh, is home to several major wholesale markets that play a vital role in the supply chain for food, clothing, electronics, and raw materials. Some of the most prominent wholesale markets include:
Kawran Bazar – One of Dhaka’s largest and busiest wholesale markets, serving as a major hub for vegetables, fruits, fish, meat, and groceries. Traders from across the country bring their products here for distribution.
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Shyambazar – Located in Old Dhaka, this is one of the city’s oldest wholesale markets, specialising in agricultural products such as rice, lentils, and spices. It is also a key trading centre for onions, garlic, and ginger.
Jatrabari Wholesale Market – A crucial hub for wholesale fruits and vegetables in southern Dhaka, supplying fresh produce to retailers across the city.
Chawk Bazar – A historic trading hub in Old Dhaka, known for wholesale spices, dried goods, and traditional Bangladeshi food ingredients.
Islampur Market – The largest wholesale market for textiles and clothing in Dhaka, popular among traders sourcing fabrics, sarees, and garments in bulk.
Gulistan Wholesale Market – A key centre for wholesale electronics, mobile accessories, and clothing, also well known for its footwear markets.
Each of these markets caters to different industries, but many are affected by syndicates that manipulate pricing and supply chains.