Over Rs. 2b already spent:

PMB receives Rs. 5b to buy paddy

By Gamini WARUSHAMANA

The Paddy Marketing Board (PMB) is ready to purchase the Yala season harvest to influence open market prices out. Inadequate capacity, lack of storage facilities and shortage of workers has slowed down the process said Chairman PMB K.B. Jayasinghe.

We have intervened. However our intervention is not effective because harvesting is taking pace at a rapid place and paddy is flooding into the market within a short time.

Production in this Yala season has doubled because 100 percent of the paddy fields have been cultivated due to good weather conditions. Normally during the Yala season only 50 percent of the paddy fields are cultivated.

In addition the fertiliser subsidy has encouraged farmers and they have shifted from other crops to paddy. This can be seen in the Walawa area where farmers who cultivated bananas and chillies have shifted to paddy farming.

Paddy harvested in the Northern and Eastern provinces is also coming into the market and we have to purchase the paddy from Kilinochchi, Batticaloa and a part of the Ampara district where we have not intervened previously.

The harvesting has speeded up with the use of machinery, Jayasinghe said. He said that PMB offers Rs. 28/kg for Nadu and Rs. 30/kg for Samba paddy. This year we have sufficient funds and the Government is ready to allocate any amount to purchase paddy.

We received Rs. 5 billion and have already purchased paddy for over Rs. 2 billion. Last year farmers sold paddy to the private sector and we got a fraction of the harvest. But this year the private sector price is very low and therefore farmers want to sell the paddy to the PMB.

Jayasinghe said that this situation is not a crisis and we are fortunate because countries such as Pakistan, India, Ukraine and Russia have faced a food shortage due to bad weather while we are experiencing a surplus. He said that co-operative societies have been appointed as agents of the PMB to purchase paddy and this will help PMB to reach every village. However in many parts of the paddy farming areas where harvesting has already started the farmers say that the purchasing price is below the cost of production.

They said that there is no government intervention and private traders purchase paddy Nadu between Rs. 15-17/kg and Samba Rs. 18-20.

A main issue is the lack of storage facilities as over 50 percent at the last Maha season harvest is still in stores. In addition there are over 20,000 tonnes of imported rice stocks in stores and this cheap rice affect the whole market, sources said.

The secretary to the ministry of agriculture said that a 1.3 million tonne harvest is expected in this Yala season.

However, an official said that the statistics available in the Department of Agrarian Services and the Department of Census are conflicting.

According to Department of Agrarian Services over 900,000 hectares have been cultivated during this Yala season. But according to the Department of Census the cultivated area is 816,000 hectares.

There is progress in the paddy sector over the decade and the area sown has increased from 878,000 hectares in 2000 to 978,000 hectares in 2009.

The growth is mainly backed by subsidised fertiliser and various regulations that restrict the filling of abandoned paddy fields. The sector is not attractive due to low profitability and the reluctance of the younger generation to take to paddy farming.