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Bumper paddy harvest and the consumer

Aug 29, 2011 2:30:39 PM - www.ft.lk

THE Daily FT yesterday reported that the Northern Province is recording a bumper paddy harvest. Estimates are that Yala harvest is above 15% over that of last year. Not only from North but from several other paddy cultivating areas a welcome increased crop is due. The Hector Kobbekaduwa Agriculture and Training Institute (HKATI) forecast is the Yala crop to be 1.9 million metric tonnes.

The end of the conflict has certainly paid rich dividends in the North and East, which last year too increased its paddy output. Last year the overall paddy production grew by near 18% to 4.3 million metric tonnes with the Maha crop up 10% to 2.6 million tonnes and Yala up by 32% to 1.6 million tonnes. The estimated harvest of 2 million kilos in the current Yala season reflects a 25% increase over the previous one.

The bumper harvest in Yala is enriching news. The reason being, the floods in January and February this year creating havoc in paddy cultivating areas. Soon after, it was estimated that 200,000 hectares of paddy land in the East and Central regions were affected destroying 0.7 million tonnes of the Maha harvest, which runs from October to March.
The Rice Research and Development Institute Director Nimal Dissanayake was quoted by IRIN news service that the northern production boosting the national supply makes a huge difference.
He noted that after the war ended the North’s contribution has been on the rise. “It is this year that we have seen the full impact of that supply,” Dissanayake added.
The Central Bank in its 2010 Annual Report apart from highlighting the North and East contribution also listed sufficient rainfall and timely release of water for cultivation, and the government policy to bring fallow lands under cultivation as contributory factors for a good harvest.
It was further sustained by the continuation of the fertiliser support scheme and paddy purchasing scheme of the government.
The Government in its zeal to ensure self sufficiency in rice has been promoting rice based products creating more public awareness. Understandably farmers have opted to boost their yield expecting a better price.
As in the case of last year, the Paddy Marketing Board (PMB) had made plans to purchase Yala crop at Rs. 28 per kilo for Nadu variety and Rs. 30 per kilo for Samba. It has been reported that paddy purchasing is being carried out at 65 centres in 17 districts whilst the Government plans to increase the number of centres to 150.
As of last week at Pettah wholesale market a kilo of Samba is selling at Rs. 60 per kilo, down from Rs. 65 a year ago, as per Central Bank data. In Dambulla and Marandagahamulla the prices are much lower ranging between Rs. 52 and 56. At retail level at least going by Central Bank data quoting prices at Narahenpita Economic Centre, a kilo of Samba is sold at Rs. 65.
Given the importance of the paddy farmer and his contribution, this bumper harvest needs to be treasured. Usually bumper harvest causes downward pressure on retail prices. It appears that the Government is sticking to its 2010 price levels for purchases via PMB. Considering the increase in inflation as well as input costs, farmers are likely to be unhappy by selling their crop at same prices as last year.
Consumers are less inclined to pay something extra for local produce or even, ‘Made in Sri Lanka’ products. The usual argument is, farmers need to improve their productivity, efficiency as well as opt for better agricultural practices to reduce cost thereby boosting their income. The latter case always makes business sense and is the way forward not only in paddy farming but also in other agricultural sectors. However Sri Lankan consumers also need to value local produce and paying an extra rupee if necessary must be done less grudgingly. In the long run there is always a return on investment when purchasing local produce or products.