By Rathindra Kuruwita
From 2015 onwards the state had purchased only around 2% of the total paddy produced in the country and thus the government had no power to control rice prices in the market, Chinthaka Rajapakshe of the Movement for Land and Agricultural Reform (MONLAR) said yesterday.
Rajapakshe told The Island that it was the reason for the government’s failure to regulate the price of rice although it had issued four gazettes on the matter from December 2019.
“The latest gazette was published on November 04, but we know that it is impossible to buy rice at the maximum retail price set by the government. This is an indication that the Sri Lankan state has no control over the collection, storing, distribution and the sale of paddy.”
During the Maha Season around 3.2 million metric tonnes of paddy came into the market and the government only had 307 warehouses that could store around 310,000 metric tonnes, Rajapakshe said.
“We did some calculations and it is clear that the private sector buys about 90% of the paddy produced annually, and the government about 2%; the farmers keep the rest.
The government should empower farmers’ associations, cooperatives and small mill owners if it wanted to find a permanent solution to annual rice shortages and high prices experienced by the people, Rajapakshe said.
He said that the impotence of the state had been exposed a few months back during a televised meeting with large scale rice mill owners and public officials. The mill owner insisted that they had purchased paddy from farmers at Rs. 55 and that it was impossible for them to sell at the stipulated price imposed by the government.
“The government officials then asked the mill owners to take release rice to the market or they would be compelled to import rice. They also warned that they would release stocks purchased by the Paddy Marketing Board (PMB). Unfortunately, the stocks purchased by the PMB were only sufficient to meet three days’ demand. So, the government will be either compelled to pay massive sums to large rice mill owners or import. None of these are sustainable solutions.”
Rajapakshe said that the government should not accept the narrative of large mill owners that they had purchased paddy from farmers at Rs. 55 a kilo. Although the government had imposed a minimum purchase price for paddy at Rs. 55, large scale mill owners purchased paddy at between Rs. 30 and Rs. 45 a kilo. They surely can give rice at the controlled prices but they know that they can just hoard paddy and sell at higher prices. That’s why the government must empower farmers’ associations, cooperatives and small mill owners to purchase paddy at a reasonable prices and distribute rice to consumers at affordable prices.”