Saturday, February 18, 2012

Is the State not going to buy the Paddy from Farmers this year? Ampara District a case in point!!

Judging from the first to harvest paddy this season, namely the Ampara District and to some extent the Kurunegala District farmers, the former do it on a large scale and therefore have to dispose of their harvest as soon as it is dried and packed. The Kurunegala farmers on the other hand are usually those with smaller plots, and are able to store their paddy and use a substantial amount for personal consumption.

No allocations have been made for the Paddy Marketing Board to purchase the paddy from Ampara. The big mill owners, including the Govt. stooges, Dudley Sirisena of Araliya Mills and Siripala Gamlath of Nipuna fame do not appear to have sent their lorries to purchase. The price of paddy has fallen to Rs16 per kg. In the days ahead we will see agitation, even riots and self immolation, as the farmers are in a real bind. I have hardly seen this in the press yet as it is too far away for the reporters to get a scoop but it is a matter of time. I understand that the big boys have let the price slide so they can QUIETLY scoop it up at that price.

This is a case of highway robbery. I as a paddy farmer know that at Rs16kg, I can mill paddy and sell rice before transport costs at Rs25kg. If one adds Rs5 for transport and retail, then it can be sold at a profit to the wholesaler at Rs30. This same rice is today Rs45. Can you imagine the profit margin of the Big millers in this game? Nipuna has his own electricity generation, and is able to sell byproducts of Rice bran for animal and human food, giving him an added profit advantage. Who is the loser and winner at this price? I am sure my reader can ascertain that!!!!

I am therefore contending that it is another calculated game played by the Govt. not to allocate funds for the purchase until most of the Ampara paddy is sold at cheap prices to millers, who can then stock and sell it whenever they wish at the prevailing retail prices which I guarantee will NOT fall to Rs30 for Sudu Kekulu or Rs33 for Nadu, both of which is the price it can be sold at if the paddy is Rs16.

It is always the miller/ wholesaler who has the money and the transport and storage arranged, who benefits from this pricing. It is important if there is a state purchasing mechanism, that unlimited funds are given for the guaranteed minimum price of Rs28kg for Kekulu and Rs30kg for Samba at all times, and not at small windows of time which is open to corruption, mismanagement and highway robbery. What actually happens even in this latter scenario is that the Millers further use the state as their bank to buy and store it for them, and they buy it later at a lower price when the state has nowhere to store, or the paddy begins to spoil due to the poor storage practices of the state warehouses. THE SYSTEM SUCKS


Anonymous said...

The Govt. has finally made a commitment to buy paddy in Ampara on February 22nd. Do not know when the money will be passed to that area to do the purchasing.

So all the lucky mill owners who bought the paddy at Rs16 can sell to Govt. for Rs28 and make a huge profit. Of course they will grease the palms of the purchasing officers to forge the documents as only a maximum amount is allowed to be purchased from any one farmer. All these rules are made to be broken by bribing Govt. officials

Anonymous said...

I was checking your blog numerous times for an update. Slow to come. Busy?
We need your input in the current economic crisis, esp at village level.

Anonymous said...

You are spot on! There was a one third page article in the Daily Mirror of 22nd February and just quoting from just one paragraph

"Quoting from a rep of a farmer organization, DM Appuhamy - We are at the mercy of Private Traders who take advantage of the lethargic attitude of the authorities. This leaves us with heavy losses and without means to settle our cultivation loans and bills. This is a regular experience during every cultivating season. The govt. should make arrangements to purchase paddy at least three months ahead of the harvesting season."

Another farmer RM Dayananda

" Farmers are compelled to accept the prices offered by private traders for want of storage facilities too. If we stock paddy in our houses, we are exposed to the threat of wild elephants. We have no alternative but to allow the private traders to take away the entire yield for whatever prices they offer. If the govt. purchased paddy at the guaranteed price during the season, the problem of storage facilities would not arise."