Paddy farmers’ problems

With ending of the Maha season paddy harvesting, newspapers and TV have been highlighting problems encountered by farmers in disposing of their harvest. Due excellent weather, free from drought, flood and disease, farmers have received a bumper crop but the problem is to convert the harvest into cash, in order to settle debts incurred in cultivation.

Traditionally most of the farmers’ harvest was bought by the private mill owners, but the Paddy Marketing Board and the co-operatives bought around 10 per cent of the harvest, helping to stabilize the purchase prices. With the ending of war, lands in the North too are being intensively cultivated, causing a surplus of rice.

In the North and East of the country, a major part of the annual rain falls during Maha season, the main period for the paddy. They are also responsible for the bulk of Sri Lanka’s rice production. Some of these paddy lands come under major irrigation schemes, others are fed with water from minor irrigation tanks and still some are rain-fed.

Normally, Maha rains commence around 15th September and prior to the rains the fields are dry and hard, where field bunds are damaged due to machinery running over during harvesting and transport. Rains soften the ground and after the first rains, farmers repair the damaged field bunds. The second and third rains collect water in the fields and ploughing is made possible.

Historically, rainwater collected in the tanks was reserved for Yala cultivation and when the rainwater was insufficient, the deficiency was supplied from tanks. But that practice was decades ago, before the Mahaveli waters were diverted to the North Central province.

Mahaveli waters

With the diversion of the Mahaveli waters, scarcity of water in the North Central province ended and farmers became lazier and politicians started taking credit for water. With the heavy rains in the Mahaveli catchment areas during May and June, water was diverted at the Polgolla dam to fill Kala Wewa and Rajangana Wewa, which feeds other tanks.

During the planning stage of the Mahaveli Development Project, there would have been certain allocation of water to each reservoir to get optimum usage from rainfall. But due to various influences, a greater quantity of water was diverted to the North. Few realize that most of the diverted water is being wasted at the cost of power generation through Victoria, Randenigala and Rantembe power plants, which were supposed to use the same water in cascading generating plants.

During the planning stage of the Mahaveli Development Project in late 1970s, the World Bank pointed out that Sri Lanka’s rice farmers consume the world’s highest quantum of water for paddy cultivation and warned that unless this consumption pattern is amended, the entire Mahaveli Project would become a failure.

Farmers were happy to see their tanks being full prior to entering the field for cultivation, which assures them of plentiful irrigation water. With normal rainfall, the irrigation tanks which were supposed to collect and store rainwater lacked the required storage capacity as they were already full with Mahaveli waters and spilled over, creating floods.

This happened in late 2010 and early 2011 during which flooding happened on three occasions; even in April 2011 during the height of normal dry season. No one seems to care about sheer wastage of water and the decline in power generation.

Village level paddy farmers at the cultivation committee meeting agree on a cultivation programme, which prescribes a period for release of water from tanks and farmers are expected to prepare the fields and sow their seed paddy by the agreed date. But invariably this date is extended and throughout the extended period, irrigation water flows through the canals without being used.

The commonest culprits for such extensions are the weekend farmers. These are mostly teachers who were appointed to rural schools a long time ago and while most teachers fought and got transferred to home stations, others stayed back and bought over paddy fields. They are free only during weekends and with their influence, get the cultivation dates extended.

Malwathu Oya, flowing through Anuradhapura, discharges waters to the sea south of Mannar. The waters of Malwathu Oya are diverted to feed Giant’s Tank close to Mannar, located in the driest sector of the country.

Most of the catchment areas of Malwathu Oya are paddy fields of the Anuradhapura district and rains as well as excess water discharged from paddy fields in western Anuradhpura and Rajangana areas flow into Malwathu Oya. The quantum of wastage of water from paddy cultivation is so high, that on number of occasions Giant’s Tank too overflowed due to excess water.

Earlier, the farmers used to sweat a lot for cultivation, but now with almost every cultivation activity from ploughing to harvesting and packing being carried out by machinery, the labour requirement has become minimal. The farmer is being transformed to a part time manager, who co-ordinates various activities.

Normally the increasing use of machinery should lower the cost of production but with small extents of land under each farmer, although his input has been low, he still needs a reasonable profit for survival. Mahaveli farmers, who received land from the Government, were allocated only two and a half acres for paddy cultivation. Most farmers survive at current prices only due to fertilizer given to them at heavily subsidized prices. In cultivation, the farmer buys seed paddy, fertilizer, pesticides, weedicides and pays for the hired machinery and labour, all of which helps make profits. After harvesting, threshing and cleaning, paddy is packed firmly into bags. In southern Sri Lanka, harvested paddy is taken home, dried in the sun prior to storage, but this practice is absent in the North, may be due to the large volume of harvest.

The northern farmer after bagging his harvest, does not wish to open the bags but intends to dispose the produce. When paddy is brought to the Paddy Marketing Board or the co-operative, the moisture content of paddy is tested and if the moisture contest is higher than the threshold, the paddy will not be accepted. When this happens, the farmer complains that his produce has been refused by the co-operative.  High moisture content in paddy can be due to number of reasons namely poor quality seed paddy where harvest matures at different times, because some sections of the paddy field did not receive adequate supply of water, the farmer himself harvested paddy too early or because the crop got wet due to rain. With the harvest being rejected by the PMB, the farmer is forced to go to the local rice miller who having tested the quality, will offer to buy at a lower price. The miller knows if the moist stock is stored, it will get spoilt and will dry the paddy prior to storage. If the paddy has become it wet needs to be milled immediately but the rice produced will be of poor quality.

(The writer is a Chartered Civil Engineer who graduated from Peradeniya University and has been employed in Sri Lanka and abroad. He was General Manager of State Engineering Corporation of Sri Lanka and left the position in February 2010. He is presently employed at a Chinese construction organisation. He also ran a manufacturing and a sales organisation for over a decade.)

Paddy Marketing Board

Meanwhile has the Paddy Marketing Board achieved its anticipated objectives? It is supposed to purchase a quantity of paddy from the farmers at a reasonable price and stabilize the market. At harvest time, their warehouses are already full with purchases from the previous season. Neither PMB officials nor the politicians seem to realize that the warehouses need to be emptied prior to harvesting season.

It is true that our current production of rice is higher than our consumption. Last year the Government sent a small quantity of rice to World Food Programme and this year too, 10,000 tonnes are expected to be sent.

The media has been highlighting the pathetic state of the Paddy Marketing Board’s paddy storage facilities and treatment of stored paddy stocks. A PMB storekeeper’s responsibility is to take over paddy from farmers and store them until instructions are received for disposal. Release of paddy stocks to the market has become a political decision and storekeepers are not concerned or trained to keep stocks at optimum conditions. The PMB’s milling capacity is limited and uses of private millers. The PMB from the very inception has never been conscious of the quality of rice produced by them.

The Sirimavo Bandaranaike government, under the cultivation drive during 1974/1975, built nearly 10 paddy complexes for storage and milling of paddy. They were located in major paddy producing areas and were built by the State Engineering Corporation (SEC), consisting of a group of tall cylindrical silos built of concrete for storage, conveyer systems to move paddy and milling equipment.

With the closure of the PMB during Ranil Wickramasinghe’s tenure during 2002/2003, the storage facilities were abandoned. Today, the concrete silos are still standing but the steel conveyors and machinery would have rotted. Silos are the commonest type of storage for grains and are being used world over.

Although the silos are nearly 40 years old, concrete silos built by SEC in 1968 for the Flour Mill at Mutwal, located north of Colombo Harbor is still functioning under Prima. There is no reason why abandoned silos cannot be rescued with necessary repairs and modifications. Concrete silos are a far modern way of storage than the current way of bags dumped on the floor.

Price of rice

The market price of rice at the Ratmalana Economic Centre a week prior to Sinhala New Year was Rs.47 to Rs.60 per kg for common varieties as raw white and brown, Nadu and Samba. There were also were other varieties priced from Rs.70 to Rs.120 per kg, all locally produced. In milling of paddy, it takes slightly under 1.5 kg of paddy to produce one kg of rice, and millers’ costs including transport and handling makes up Rs.5 per kilo.

Thus paddy purchased at Rs. 30 per kg from the farmer becomes Rs. 50 post-mill. The price paid by the consumer includes costs of transport, loading, unloading and retailers’ expenses. Therefore when customer pays Rs. 47 per kg, the farmer would have been paid around Rs. 23 per kg of paddy.

The Government has held prices payable to paddy farmers fixed during the past few years and farmer organisations have been clamouring for higher prices. The Government too maintained the price of fertilizer in spite of escalating prices in the world market. Wheat and maize prices in the world market have been steadily rising, with former surplus grain stocks being diverted for the production of ethanol, used as an additive for petrol.

The rise in wheat and bread prices has forced consumers to move to cheaper rice and has consumed the bulk of the increased production. Is it fair for the Government to continue to hold the price of paddy low in the face of increases in world market prices, especially now with the increase in fuel prices and devaluation of the rupee?

Rice exports?

Are our farmers capable of producing rice for an export market? To export, we need to target a market and produce as per market requirement. We also need to produce a sufficiently exportable quantity of the item in the same quality. Are we capable of producing even 1,000 tonnes of the same quality?

Our farms are so fragmented it is extremely difficult to produce rice of a particular quality and quantity. In comparison with other countries, USA has just over two million farms with an average farm size of 450 acres, with 930,000 farms over 1,000 acres in extent. In Brazil of the total farm acreage, 45 per cent are farms over 1,000 acres in extent which shows why USA and Brazil produce such a heavy percentage of the world’s agricultural output.

USA maintains a strategic stock equivalent to four months consumption of wheat and corn to tide over emergencies. These stocks are maintained by the private sector that are paid for per tonne basis and ensures stock levels are maintained as instructed. Stock level maintenance is not easy as grains are liable to damage by rodents, weather etc. in storage and need to be periodically disposed to the market prior to being spoilt and stocks be replaced with the next harvest - no easy task.

But what will happen to the food security of the country if the next season’s crop becomes a failure due to floods, drought or some other reason? What about strategic stocks? Even today we have not heard of politicians or government officials discussing strategic stocks. But one thing is certain: our PMB is not efficient or capable enough of ensuring such an important task.

Higher quality rice

For some time, CIC has selected indigenous varieties of rice and promoted their production without usage of chemical fertilizers or pesticides for high-end consumers and some leading supermarkets sell them, but at a price. They advocate the cultivation of selected indigenous varieties of rice in the wet zone, where fields are smaller, as ideal for such cultivation.

The farmer could be paid a higher price and the small quantities produced could be exported to exclusive markets. But our politicians have not heard of this story. The presence of luxury varieties of rice in the market, at CIC as well as in economic centres indicate the rising demands of customers’ tastes and the ability of growers who cater to their needs.

Surely the growers of these selected varieties are not poor farmers, but are cultivated by large growers who have the know-how, technical expertise and market knowledge to cater to gourmet markets. Such growers know that higher profits could be made by catering to exclusive customers who have the ability and are willing to spend.

Present day medium and large rice millers have become quality conscious and have adjusted their mills to handle a particular variety of rice and produce much higher quality as well as quantity. This in turn limits the number of buyers available to the grower to sell his particular variety of rice.  This specialisation of millers along with telephone connections countrywide, has enabled wholesale buyers to contact millers directly and collect a lorry load of rice of a particular variety from a single source, saving time and expense.

Some of the large millers have also become wholesale dealers of rice and control the market. What the Government and the farmers do not appreciate are the millers who have the ability to buy the large quantities of paddy at harvesting time, which requires billions of rupees of capital which come out of their savings or bank loans which carry interest. Until the paddy is milled and sold - and this could take months - their loans collect interest. It is the profits reinvested over the years that have given them the capital, modern mills and transport equipment they command.