The price of rice is likely to drop below Rs. 200 by the end of January, according to Deputy Minister of Food Security R.M. Jayawardana. 

Speaking to The Sunday Morning, Jayawardana outlined the current state of rice stocks and annual requirements: “According to reports, we have a shortage of 70,000 MT of rice in Sri Lanka.”  

“The reports originally indicated a stock of 4.2 million MT of rice in the market. Currently, Sri Lanka’s annual consumption is 2.4 million MT of rice. Further, we require 300,000 MT of rice for production of other food and another 150,000 MT of rice for ethanol production,” he said.

“In total, we require 2.85 MT of rice per year. If we did have the stocks as specified in the report, we would not have a rice shortage in the country,” he added.

Jayawardana stated that further issues had been identified, including the problem of hoarding stocks outside of the market. 

“With those in mind, other reports indicated that we had a shortage of 70,000 MT of rice. Therefore we opened up for imports and brought down 90,000 MT of rice into the country. However, it was still inadequate. We therefore permitted rice importers to continue to import until 10 January,” he stated.

The Deputy Minister acknowledged the difficulty in verifying these figures and confirmed that investigations were underway to understand how the data had been compiled. 

Despite these uncertainties, he assured that existing stocks, combined with imports and the upcoming harvest, were sufficient to meet the country’s rice needs for January and beyond.

Meanwhile, Deputy Minister of Livestock and Agriculture Namal Karunaratne attributed the supply crunch to hoarding by certain mill owners and other entities. 

“Mill owners and others hiding paddy are aware that fresh rice will start entering the market in three weeks and prices will stabilise. This will likely prompt them to release hidden stocks,” he said.

Karunaratne also highlighted that allegations of hoarding had compounded the public’s anxiety about rice availability. 

“While imported rice is available in the market, it’s insufficient to meet the demand fully. Once the new harvest begins to arrive, this manipulation of the market will no longer be viable,” he added.

“We trust that in the next two to three weeks, the problem will solve itself. By the 20th of this month, harvesting will begin in various parts of the country,” Karunaratne further stated. 

He elaborated that farmers cultivating kekulu paddy, harvested during the first monsoon season, were set to begin reaping their crops soon. The harvest will be processed and introduced to the market, easing the supply crunch.

Additional harvests were also expected to follow, Karunaratne explained. 

In northern regions such as Kilinochchi, Mannar, and Vavuniya, harvesting is projected to commence by late January, further bolstering the rice supply.

Jayawardana echoed this optimism, emphasising that the arrival of fresh rice stocks was likely to lead to a natural correction in prices. “We anticipate that the market will stabilise and prices will drop below Rs. 200 per kg,” he stated.

Jayawardana also emphasised the importance of maintaining buffer stocks to prevent future shortages. “We have allocated resources for storage and are working on building a sustainable buffer stock system. This will ensure stability in both supply and pricing,” he said.

Buffer stocks are typically purchased at lower rates, which will also contribute to reducing market prices once fresh rice enters circulation.

Both Deputy Ministers assured that rice prices would not increase further. Instead, they expect a decline as the market receives fresh supplies. 

“In terms of price control, we are engaging with rice millers, traders, and other stakeholders to finalise a fair pricing strategy. A decision is likely to be made before the end of January,” Jayawardana stated.