• Mill owners warn of continuing shortages as Maha harvest unlikely to meet the mark
• Govt. has to take necessary steps, recent disaster severely impacted paddy lands: Ranjith
• Raids do not show large-scale hoarding of paddy by large mill owners: CAA

Despite the Government’s measures to import 70,000 MT of rice to address ongoing shortages in the local market, mill owners allege that the expected quantity would need to be doubled to adequately meet demand, arguing that the country is unlikely to achieve the anticipated harvest during the Maha season in January next year.

As a result, mill owners have urged the Government to either import at least 200,000 MT of rice or compel a few large-scale millers to release their stored stocks into the local market.

Speaking to The Sunday Morning, All Ceylon Small- and Medium-scale Rice Mill Owners’ Association President B.K. Ranjith stated that the recent disaster had severely impacted paddy fields, making it unlikely that the expected harvest would materialise as planned. 

“The harvesting is only expected to begin around the end of January 2025,” he emphasised. “If there are no stocks in the local market, paddy prices will also increase and the shortages will persist.”

Commenting on the locally available stocks, Ranjith noted that during a recent meeting with President Anura Kumara Dissanayake, officials had shared statistics on paddy stocks. He noted that the President likely had the best understanding of stock availability and urged the Government to act as promised.

Referring to previous statements by Deputy Minister of Agriculture Namal Karunaratne – also the National Convenor of the All-Island Farmers’ Federation (AIFF) – Ranjith said: “They previously said that rice stocks were in the possession of large-scale mill owners and now they are part of the Government. Therefore, they must take the necessary steps.”

Production surge?

Central Bank of Sri Lanka (CBSL) statistics revealed that prices of all rice varieties had increased in the Pettah market due to limited availability of stocks. 

Accordingly, as of Thursday (5), in Dambulla, samba was priced between Rs. 238 and Rs. 248 per kilo, while nadu was between Rs. 235 and Rs. 248. Kekulu (white) was sold between Rs. 237 and Rs. 240, and kekulu (red) ranged from Rs. 237 to Rs. 243. Imported ponni samba was priced between Rs. 275 and Rs. 283. 

In Pettah, the cost of samba was between Rs. 240 and Rs. 260. Nadu was also in the range of Rs. 240-260, while kekulu (white) was priced between Rs. 225 and Rs. 245 per kilo.

According to CBSL statistics, rice production in Sri Lanka showed significant growth in 2023 compared to 2022. 

During the Maha season, production increased from 1.93 million MT in 2022 to 2.70 million MT in 2023, reflecting a 39.6% growth. The Yala season also saw a substantial rise, with production climbing from 1.46 million MT to 1.82 million MT, marking a 24.3% increase. 

Overall, annual rice production surged by 33%, reaching 4.51 million MT in 2023 compared to 3.39 million MT the previous year. Without imports, the rice availability for domestic consumption in 2023 stood at 2.76 million MT.

As stated by the CBSL, this output is sufficient to cover domestic household demand for around 13 months.

Meeting the shortage 

The Department of Agriculture has forecast paddy production for the 2023/’24 Maha season at 2.63 million MT. However, this represents a 2.4% decline compared to the previous Maha season, based on the sown extent reported as of the end of March. 

Furthermore, the forecast paddy production in the 2024 Yala season is estimated to be 1.77 million MT, which is a 2.6% reduction from the previous Yala season.

Last week, the Government approved private sector rice imports following a Cabinet discussion led by Cabinet Spokesperson Minister Dr. Nalinda Jayatissa. All ministers agreed with the decision, enabling the private sector to promptly import necessary rice stocks without restrictions on rice types.

Rice is the staple food of Sri Lanka, with paddy crops being cultivated as a wetland crop in all districts. There are two cultivation seasons, namely Maha and Yala, which are synonymous with the two monsoons. The Maha season falls between September and March, corresponding to the north-east monsoon, while the Yala season is effective during the period from April to the end of August. 

The season is defined by when the crop is sown and harvested during these periods. However, the entire area devoted to paddy cultivation is not utilised due to various reasons, such as a shortage of water during the seasons.

The Government has allocated Rs. 11 billion to provide a financial subsidy for fertiliser purchases to support paddy farmers during the Yala season. It previously initiated a programme to offer Rs. 20,000 per hectare and Rs. 40,000 for two hectares of paddy cultivation. Additionally, TSP fertiliser has been distributed free of charge, with plans to significantly reduce the prices of urea and MOP fertilisers to ease farmers’ production costs.

CAA moves 

Nevertheless, when contacted, a senior official attached to the Consumer Affairs Authority (CAA) revealed that, according to the raids and market observations conducted by the authority, they had not observed large stocks of paddy concentrated among large-scale mill owners.

“We are conducting raids as we don’t wait until the Government issues instructions; the CAA has legal authority to do so. Although there were allegations regarding a concentration of stocks with large-scale mill owners, the authority did not witness this – at least, not in the official storehouses used by these millers,” the official told The Sunday Morning.

However, the official further noted that the CAA did not conduct strict raids despite the existence of a Maximum Retail Price (MRP), since it would lead to retailers not selling rice and a subsequent severe shortage in the market. “For now, almost all retailers sell rice above the MRP,” the official revealed.

Speaking to The Sunday Morning, CAA Chairman Hemantha Samarakoon said the authority continued raids and monitored the market situation. “Shortages will ease as soon as the imported rice comes to the market. Private importers have already been given approval to import rice. Sathosa too will commence importation after 20 December,” he said. 

Several attempts to contact Trade Minister Wasantha Samarasinghe and Deputy Minister of Agriculture Namal Karunaratne were futile.