Thursday, May 29, 2008
I as a paddy farmer having about 3 acres of paddy land in Hingurakgoda as part of the total 5acre property (the rest planted with coconuts, bananas mango, orange and lime as well as a few vegetable beds)
I have just sown(May17th&18th) white Samba the BG358 variety for the first time, and unlike last season I have not transplanted. This was due to a cost of Rs10,000 to transplant not compensated by the certainty of a much higher yield. I have previously planted red nadu, red samba and white nadu. I want to see which variety gives me the best yield to determine what is best for my particular soil conditions.
As I am the last in my irrigation canal and this season in exclusively tank fed from Minneriya, I foresee a problem with a shortage of water, having to pump water at expense when necessary to cover a shortage. I have obtained permission to close all other water lines for one night a week to ensure I get water, but how this will work in practice is yet to be seen.
It takes me two full days of a 2 inch pipe of pumping to flood all my fields at a cost of ten liters of kerosene which costs 80/- a liter at present. I did this on May 24th and 25th while the water was shut to our canal. It is essential that in the first weeks for the germinated seeds to take root, that fields get a good soak and a head start over the weeds. The days are baking hot and the fields in higher ground like mine can crack in the heat.
I am at a loss to know which season yields more, but farmers tell me it is Yala when the sun is more prevalent and photosynthesis has the greatest chance given the availability of water. Only time will tell! Farmers expected a bumper crop last season, only to be scuttled by the heavy rains at harvest.
It is such a joy to see the new rice plants and its light green form in the fields as it is a sea of green wherever one looks in my area. The farmers are broke exhausted and expectant that this year will see a turn around in fortunes. In wet fields one gets a host of birds, a pair of Indian Rollers in my case, swooping down to catch small frogs and worms in newly sown ground.
The photos here show the preparation of the fields with the tractor, the sowing by hand of the germinated seed paddy, and then the light green fields a week later. In another week they should be at their glorious green.
Friday, May 9, 2008
Many of the small landowners, who have for the most part inherited their paddy fields have been in the habit of renting them to other farmers to farm and the payment as noted elsewhere is traditionally 20 bushels of paddy per acre rented per season. In today’s terms that is about Rs12,000 per season.
There are experienced farmers who farm large lots of lands on this basis as they have all the mechanical machinery to perform most of the tasks, using minimal labor. It is the next most efficient way of farming this land, short of amalgamating large tracts into one and farmed in one large area by one person. I have a neighbor who does not own any land but farms about 100 acres and does it well and has a higher yield and productivity per man hour than all the small farmers.
When the price of rice increased, the owner not content with the increased value of the rent as it is in kind, has in many cases decided to work the land himself this season and this farmer is now wondering what he should do iin the light of new events.
His solution was to sell some of his farm machinery and buy a large lorry and has decided to buy paddy from farmers and sell them to the large mill owners. Filling a 5 ton lorry he says he can make Rs30,000 per load after paying his wages for hauling and driving and taking account of the vehicle amortization cost. This is for less than a days work as in the morning he knows the millers buying price and he then offers a price to farmers, some of whom will sell their paddy and is able to fill the truck by early afternoon going from farm house to farm house. This he says has almost no risk while paddy farming is full of risk. We lose another efficient farmer this way!!!
In my opinion these landowners who have now taken back control of their land do not know the inherent costs in farming and assume that they can make a lot of money. Inevitably they will lose or at best make only a little and possibly less than the rent they would have received, with a lot more effort and risk. That is not to say that as their efficiency is much less, the output per acre will also fall for the same inputs such as fertilizer. The overall effect therefore is for a fall in yield and the government carrying the cost of the fertilizer subsidy that has actually contributed to a lower yield despite the higher prices in the market. I see no evaluation of this fact anywhere in the discussions of the increased acreage under cultivation.
This is an attempt to give the reader a realistic idea of what it costs to work an acre of paddy for a season (two seasons per year) and the profit and benefit to the farmer is purely a factor of the yield, and the price he receives on the sale of the paddy. This is the cost for the year and ignores the cost of the land or water, which though very real is treated as zero. A farmer who is working another’s land has to pay the owner twenty bushels per acre per season and that is 420kg, which at Rs 30 a kg is 12,600.
This example is worked on the basis of 100 bushels per acre, which is average for good land here in Polonnaruwa, and the yield can vary between types of seed paddy planted but for the purpose of this exercise, this will do.
The fertilizer will cost Rs 1500/- at the subsidized price, which if one purchased in the open market would be over Rs 16,500/- which means the fertilizer price is subsidized to the tune of Rs15,000/- an acre or about Rs7.50 per kg of Paddy produced. The true cost to the nation should therefore include the unsubsidized price at which the government purchases the paddy. The cost of the seed paddy is Rs 2900/- The cost of preparation if paid labor is used except for the farmer who is working his land is Rs 4000/- and the cost of the ploughing using hired tractor driver and diesel is Rs6000/- The cost of weedicides and pesticides is Rs3000/- assuming a low use of such on the property. Then instead of using paid labor to cut, he uses a cutting and threshing machine, the cost is Rs7000/- and then the cost of drying and fanning the paddy before preparing the bales for sale is a further Rs3000/- not counting his labor in taking care of birds and mice and other pests during the growing season. The total cost is therefore Rs27,400/-
The maximum profit to the farmer who owns his own property therefore becomes, a function of the revenue of Rs63,000/- and cost of Rs27,400/- and is Rs35,600/-. And Rs23,000/- if you don’t own the land. On the basis of this being 6 months income, it is a maximum of Rs6,000/- a month. Don’t forget this is based on Rs30 a kg price. The government guaranteed price of Rs22 will only give a profit for the owner farmer of only Rs18,800/- halving his profit. By implication a farmer who has twice this extent stands to benefit twice as much and so on. Bear in mind that half the farmers probably get much lower yields and some have costs that are higher so while this is a guide, it is also a reflection that at this higher price the farmer is still pauperized, despite the government subsidized fertilizer.
Monday, May 5, 2008
The appreciation of what a peasant farmer has to endure to make a living is something no book can teach and until one lives that life completely, the nuances of the risks he faces are cannot be comprehended and then evaluated.
Many of the people in the aid business, be it donors or government bureaucrats are merely trying to salve their consciences or at best do their jobs. To do it effectively all the dynamics have to be accounted for. In my opinion risk minimization is the way to approach this subject, rather than poverty alleviation of rural farming populations.
I have endured an additional risk this year 2008, over the risks I have begun to accept. The weather pattern internationally and specifically to Sri Lanka has been extremely unusual with some saying El Nina effect. The rainfall has been excessive island-wide, which has led to the farmer being unable to plant his vegetable crops according to plan, which consequently has resulted in steep prices the consumer has had to pay. Ironically the steep prices have NOT helped the farmer increase his income, as his overall net revenue has fallen due to his crop loss being greater than the price increases, where most of the margins are accounted for in the post harvest food chain down to the ultimate consumer.
In my case where I use paid labor, I have had to pay wages for people who have not been able to do a days work due to the rain, and whoever tells me to supply raincoats is off the mark. I have bought boots for them and they don’t like to use them, if I supply raincoats its jut the dogs who will have a field day tearing them apart, when they have been put aside and forgotten in the fields when the rain ceases. Such is the mentality of the person who is now part of this society where they expect everything free, be it from the government or their employer.
In my case even trying to grow organic is a farce, in an environment where I am unable to minimize risks, the only practical way being under greenhouses where most risks are eliminated. Take today’s example of the wholesale prices paid by small shop keepers to buy vegetables in the Meegoda wholesale market close to my farm and close to Colombo. (inevitably buying large bags of between 50kg and 70kg will command prices about 20% less than what I note below, but also have a higher percentage wastage as there is no way of sorting out as one has to buy the whole bag of the truck, not knowing the quality of what is inside.
All prices are for a kg (2.2lbs) as of May 4th 2008
Tomatoes Rs 150, Capsicum Rs 240, Green Chillies Rs 200, Makaral Rs 80, Karavila Rs 70, Bandakka Rs 70, Wambatu(auberrgine) Rs 70 and Cucumberr Rs30. Now I sell my produce on home delivery at between Rs 80 and 100 a kg as I find it difficult to sell at a higher price to cover my costs, and in the shop on the farm I sell at Rs 20 a kg less. How can I sell my better produce (as in no pesticide and no chemical fertilizer, but sometimes with the odd pest embedded) at higher prices to compensate me for extra costs and low yields? I have to sell my Tomatoes at Rs 250kg and no one will buy at that price.
So Colombo ladies who think you can buy good for less than the Kollupitiya market think again, you just can’t afford my produce if I were to sell at a price where I can afford to eat at least one meal a day. I am effectively subsidizing your lifestyle. Anyway why do you want to eat Organic when the air around you is so polluted that no matter how much organic you eat you will not be able to cleanse your body from the carcinogens you breathe?
Returning to the topic, the conclusion is that due to supply and demand factors the price of vegetables is beyond anyone’s control least of all the farmer’s, and in order to stabilize the prices while giving the farmer a greater share of the pie, a lot more has to be invested in post harvest technology over an above yield improvements which are still necessary at the farm. So NGOs if you are still interested in helping the rural farmer, rather than your good selves in posh cars and offices and fat salaries then please take heed.
A farmer will never sell you produce if he can get a better price. So you give a price point that is high enough to encourage him to grow, while limiting how much you will buy, so you don’t encourage the farmer becoming a middleman at your expense. The produce you receive you keep in conditions that allow longer shelf-life, and you arrange the disposal of such. Keep strict management controls so you don’t lose on this deal, and run it as a business with incentives for management properly structured. As a private sector person I would also like to do something with a long- term profit motive but the capital cost of establishing an enterprise precludes me from going ahead, unless development financing of a long-term nature can be obtained at concessionary rates. Such enterprise actually would be more effective than trying to do it through the NGO or government due to inefficiencies.