Saturday, March 29, 2008

Update on rice prices

After I wrote the article below yesterday, I heard on the news last evening, that the government has removed the Rs 20 per Kg duty on imported rice, so that there will be no price gouging by the large millers. Additionally it was stated in the news item, from the government owned media that due to this timely action the price of rice will come down for the avurudu season. This was stated by a senior minister with responsibility for agriculture and hailing from the Polonnaruwa district, whose brother is one of the largest millers in the Island,and who controls Araliya Rice Mills.

I found this rather ironic. I hope it is true, for the sake of the beleaguered consumer and we shall see.

Since January when the last time the duty was removed, the prices from either India or Pakistan, from where all our recently imported rice came, has gone up by SL Rs 20 a kg, so this rice cannot be retailed below Rs 75/- kg. This is a crude attempt to dupe the poor farmers who are looking for a few more rupees, to frighten them into selling their small paddy harvest to the big millers (we know who they are)by implying that if they do not sell at the current price, the prices will fall when the imports flood the market at much lower prices.

As I am also a retailer of rice, and have sold this imported rice when SL rice was scarce earlier in the year, know that the consumer does not like its taste and they do not know how to cook it either to get the best out of it. So there is little competition from that.

The only truism in all this is that allowing imports duty free in a period of rising prices, is that there will come a price at which the consumer will substitute for local rice, and accordingly the price will be prevented from rising too high, say above 125/ a kg as then import substitution will take place.

Every thing has a price as they say and as usual the market place determines in the absence of artificial barriers such as duty. We can only isolate ourselves from the world market if we produce more of what we eat, by being more efficient, and more aware as consumers about how best to help our motherland.The only food of any scale we export is tea and cinnamon, it is staggering how much we import to eat, in an island so lush so rich and so blessed with growing conditions.

So farmers hold on to your stocks, consumers brace yourselves for an expensive avurudu no matter what our leaders promise, just eat less and watch your waist line it will just help you live longer and healthier and feel less stuffed.

For the record I am a rice farmer who grows his own rice pesticide free, and also buys from neighbors and stores, par boils, mills (not my mill) transports and sells direct to the eating consumer either from my shop or home delivery to the door about 12 varieties of newly milled rice. At the moment I drive my own truck from my fields to delivery points in case one thought I am just sitting at a computer all day.

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