Cabinet nod to buy paddy at competitive prices

• Agriculture Minister Mahindananda Aluthgamage confirms PMB will purchase paddy at Rs. 75 a kilo
• Says Rs. 29.8 b required for paddy purchase will be secured via State banks
• Govt. intends to provide fair price for 2021/2022 Maha season harvest, whilst maintaining sound buffer stock
• Assures rice prices will not be increased due to higher guaranteed price 
• All Ceylon Farmers Federation claims Govt. decisions are not justifiable given cost of production, inflation 
• Suggests expansion of compensation to the entire farming community 
• Accuses Govt. of creating an unwarranted crisis amidst pandemic

The Paddy Marketing Board (PMB) began purchasing paddy from farmers at Rs. 75 per kilo from yesterday, up from Rs. 50 previously.  The move was announced by Agriculture Minister Mah-indananda Aluthga-mage at the post-Cabinet meeting media briefing, noting that the Rs. 29.8 billion required for this purpose will be secured through State banks. 

Earlier this month, Finance Minister Basil Rajapaksa said the Government would buy paddy at Rs. 75 rupees a kilo to make up for a 30% crop loss as part of Rs. 229 billion ‘relief package’.

Minister Aluthgamage said the objective of the Government was to provide a fair price for the 2021/2022 Maha season harvest, whilst maintaining a sound buffer stock of paddy.

The purchase of the paddy harvest is carried out directly through the PMB and by the District Secretaries and Government Agents through the small and medium scale mill owners.

Aluthgamage pointed out that PMB would purchase the harvest at competitive prices, along with the private sector.

“We saw how large-scale mill owners tactfully created an artificial price and inflated a kilo of rice between Rs. 150 to Rs. 200. The Government will not allow it and to counter such future situations, we decided to import a certain quantity of rice stocks,” he explained.

However, the prices quoted by the private mill owners are much higher than the guaranteed price for paddy kilo, which is at Rs. 50 (Nadu), Rs. 52 (Samba) and Rs. 55 (Keeri Samba). Previous guaranteed prices ranged between Rs. 30 and Rs. 32 per kilo.

Despite the move to import rice, the Minister assured that the prices would not be increased under any circumstances.

The proposal to this effect submitted by the Agriculture Minister was approved by the Cabinet of Ministers on Monday. 

Meanwhile, All Ceylon Farmers Federation National Organiser Namal Karunaratne said the move was not justifiable. 

“The farming community is not ready to accept neither the guaranteed price of Rs. 75 a kilo for paddy, nor the Rs. 40 billion package announced for compensation of crop loss – unless it is offered in a blanket form. Given the crisis they created after banning agrochemical fertiliser imports, cost of production has increased to over Rs. 100 now. A bag of fertiliser is now sold around Rs. 15,000 to Rs. 20,000. How can the Government justify the escalated cost of living and production cost?” he argued. 

Commenting on the Rs. 40 billion allocated to provide compensation for paddy crop loss during the 2021/22 Maha season, Karunaratne said it should be extended to the entire farming community, as he accused the Government of being responsible for the harvest shortage that had come about as a result of the ban on agrochemicals in the wake of the COVID pandemic.