Growers oppose 2016 Budget move to import coconuts

The Coconut Growers Association of Sri Lanka (CGASL) has raised concerns about 2016 Budget proposals which spelt out substantive reforms in the coconut industry.

In its reforms in plantation economy, section 160 reads: “The coconut industry too is faced with the issue of lack of coconuts for value addition. The Budget proposals for the first time propose the import of coconuts to meet the shortfall of local produce for the coconut processing industry.”

The Plant Protection Ordinance No. 165/2 of November 1981 prohibits the importation of coconut palm products and any imports even under quarantine control would be a violation of this act.

Sri Lanka is now facing the adverse consequences of relaxation or the lapses of quarantine control with the advent of the aceria mite infestation which commenced around 10 to 15 years ago, and has spread throughout the country retarding the production and size of coconut with the nut weight reduction of about 30% with a severe attack.  

Similarly, the Weligama Coconut Leaf Wilt Disease (WCLWD) propagated through a protoplasmic (virus), is affecting Matara District, with no remedial action except cutting down the affected trees (number of trees to date is 280,000). 

The local coconut is synonymous with the ‘Produced in Sri Lanka’ tag and similar to tea and cinnamon, and is recognised worldwide as a premium product offering high quality. This proposed liberalisation will have an adverse impact on the whole industry, affecting the prices of nuts and the quality of processed coconut products negatively, the CGASL says.

In a statement, it adds: “Does the coconut manufacturing industrialist wish to blend the imported coconut kernel with local coconut kernel during the processing stage and ship out as ‘Sri Lankan coconut products? How does one ensure ‘organic certification’? Sri Lanka sells most of the non-traditional kernel products as ‘organic’ and caters to a niche market.  The importation of coconuts or kernel products for processing will have an adverse impact on Sri Lanka brand value.”

Outlining the current status of coconut plantations, CGASL reiterates that no other crop plays such an important role as the coconut palm in relation to the economy and the livelihood of people of Kurunegala, Puttalam and Gampaha Districts and to a lesser extent in Southern, Northern, Eastern and Sabaragamuwa Provinces.

“In the past 10 years, the change in weather patterns and two unprecedented droughts severely affected the coconut plantations, resulting in approximately 300,000 bearing trees being destroyed.  Weligama Wilt Disease and aceria mite infestation has had a drastic impact on nut production. The impact on land fragmentation throughout the country cannot be quantified.”

Despite these obstacles, from 2002 to 2014 the land area under coconut has increased from 395,000 to 440,000 hectares. A major portion of the increased 45,000 hectares has not yet started to contribute to nut production. This increase is due to incentives that are currently being afforded to the coconut grower. 

In the year 2014, total nut production (million nuts) was 2,870 (100%); household fresh nut consumption was 1,830 (63.8%); nuts used by the industrialists was 1,040 (36.2%); exported portion was 766 (26.7%); and consumed locally in processed form was 274 (9.5%).

Coconut growing is a $ 1,550 million worth business in terms of value of nut production only. Of this $ 558 million has come from export earnings, in 2014. Balance is the value of local consumption.

“The CGASL will support all endeavours to provide more nuts for production by industrialists and support the Government’s endeavour to increase exports of processed and value added products. We can achieve this through collective effort from all the stakeholders of the coconut industry.

“In this effort CGASL reiterates that coconut being a perennial crop with gestation for income production being eight years it is imperative for successive governments to understand the sector and maintain incentives already provided to the farmers in its financial policy and other inputs such as subsidies for planting material, moisture conservation and fertiliser,” it added.

The coconut growers are a community comprising a wide cross section of growers from very small farmer, to medium and plantation owners. The smaller section of growers are not represented by any organisation and have no collective voice in the face of adverse situations that may affect them. The financial viability of the entire spectrum of coconut growers is essential to maintain and increase production of nuts.  

Improvement in the quality of technical support to the grower from Coconut Research Institute (CRI) and Coconut Cultivation Board (CCB) is essential to encourage and motivate the grower, the CGASL stated.

Despite the reservations, the association noted some positive proposals in the 2016 Budget. The CGASL commended the tax holiday to be granted to companies that use drip irrigation methods and endeavour to use high-yielding seeds in agriculture as a positive move; however it noted that these concessions should be offered to the entire spectrum of growers including coconut and not be limited to companies.

The 2016 Budget has proposed to lift the ceiling on ownership of land, this certainly would give an impetus to existing coconut grower to expand their investments in coconut plantation.

In conclusion, the CGASL emphasised that importation of coconuts to cater to an export market is not a solution as proposed in the 2016 Budget. 

“The village grower is dependent on the price of a coconut to keep his home fires burning. The risk of coconut palm getting infected with virus and predators are very high and could destroy the entire industry. The valuable brand name ‘Sri Lanka coconut product’ will be diluted. The benefit is only for a few industrialists. Is it worth at the cost of the millions of people who rely on the cheapest and healthiest source of fat in their daily meal?” the CGASL asserted.