{"id":107156,"date":"2020-09-30T16:49:09","date_gmt":"2020-09-30T23:49:09","guid":{"rendered":"http:\/\/www.lankaweb.com\/news\/items\/?p=107156"},"modified":"2020-09-30T16:49:29","modified_gmt":"2020-09-30T23:49:29","slug":"a-tried-tested-method-of-agricultural-marketing-to-solve-the-high-prices-of-vegetables-also-to-reduce-dependence-on-imports","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2020\/09\/30\/a-tried-tested-method-of-agricultural-marketing-to-solve-the-high-prices-of-vegetables-also-to-reduce-dependence-on-imports\/","title":{"rendered":"A Tried & Tested method of Agricultural Marketing to solve the high prices of vegetables & also to reduce dependence on imports"},"content":{"rendered":"

By Garvin Karunaratne<\/strong><\/em><\/span><\/h2>\n\n\n

The Hon President may please  consider getting the\nArmy to establish the Marketing Department of the Fifties and thereby enable\nvegetable availability as well as controlling inflation. It can be later\ndeveloped to be a major department. The total outlay can be recouped including\nthe cost of establishing a Cannery within the first year. I can vouch for this,<\/strong><\/p>\n\n\n\n

My earlier paper is reproduced and if implemented\nnow(can be done in days) will be a great feat. <\/strong><\/p>\n\n\n\n

It is hoped that our\nPresident\u2019s attention is brought to the fact that our country was the only\ncountry in the world to  have a system by which the prices of veg and\nfruit was unofficially controlled. That was the Marketing Department(MD) at\nwork, buying and selling vegetables and fruit, competing with private traders,\nkeeping a low margin of around fifteen percent to cover up cost of transport\nand wastage in handling.<\/p>\n\n\n\n

It would behove of our\nPresident to immediately order the Army to buy vegetables from the Producer\nFairs, keep a margin of fifteen percent to cover cost of petrol and wastage and\nsell in the Cities. Traders keep at least a total of one hundred percent \nat the buying place, at the wholesale dealer in Colombo and at the retailer\u2019s\nplace.<\/p>\n\n\n\n

The Army was entrusted with\nthis task in the days of Premier Mahinda Rajapaksa in about 1998 and then the\ncity was full of army lorries selling vegetables. I have seen them perform this\nyeoman service.<\/p>\n\n\n\n

The Dambulla Economic Centre\nand economic Centers at many places- is not the answer, because as detailed in\nthe Daily Mirror of 24\/2 Take Immediate steps to control Veg prices: Pres. to\nOfficials\u201d because vegetables brought to Dambulla from the areas of vegetable\ncultivation are distributed back (for sale) to the original areas\u2026 these\ncenters are controlled by large scale traders  with vested interests.\u201d\nOnce it was reported that the officer entrusted with the Dambulla Economic\nCenter was severely assaulted.<\/strong><\/p>\n\n\n\n

It is traders that rule. When I\nonce went to Dambulla and walked around, it was only traders. My incessant\nvisits to producer Fairs  for over six years enables me to sniff producers\nfrom a fair distance. It will be a difficult task to find a Producer Fair in\nentire Sri Lanka not visited by me.<\/p>\n\n\n\n

In 1955 when I joined the MD as\nan Assistant Commissioner we did work from small shanty type of  sheds- we\ncalled them Packing Sheds. They were all buildings built with timber, a cement\nfloor and a corrugated cladding to keep off the rain and in a corner was housed\nthe Assistant Commissioner working in the air and dust of onions and\ncondiments. There were no DPJ Towers or Setsiripayas for us.  These were\nshed put up overnight to house the British Army when the Japanaese declared\nwar.<\/p>\n\n\n\n

In the MD,our work commenced at\n4 AM in the mornings on at least four days a week, visiting Producer fairs and\nensuring that we bought produce competing with the traders.<\/p>\n\n\n\n

I include parts of my earlier writings, edited to avoid\nrepetition in support.<\/strong><\/p>\n\n\n\n

Once in the pre IMF days, in the days before Sri Lanka started\nplaying poodle to the IMF Sri Lanka did have a method by which it controlled\ninflation.<\/h4>\n\n\n\n

That was the Marketing\nDepartment at work. There was a  scheme where the Marketing Department\npurchased vegetables at the producer fairs, brought the produce overnight to\nthe cities and sold the produce keeping a very low margin of fifteen percent to\ncover up cost of transport and wastage. This Scheme which had been developed by\nSri Lankan administrators and politicians was abolished on instructions from\nthe IMF in 1978 when the Jayawardena Government caved in to the IMF. Since then\nit is the private sector traders that rule trade.<\/p>\n\n\n\n

If only the Marketing\nDepartment  activities are restored, we can not only control inflation,\nbut we can also reduce imports and also find employment for our people.<\/p>\n\n\n\n

It is time that our new\nGovernment makes an initiative to re establish the Marketing Department\nactivities- its vegetable and fruit marketing scheme and the Canning Factory.\nThat will be a real achievement.<\/p>\n\n\n\n

Inflation- Rising Prices is a\nmajor concern today. Sri Lanka had built up the infrastructure to control\ninflation. What we are seeing today-unbridled inflation, has been caused\nbecause we  did away with the infrastructure we had.<\/p>\n\n\n\n

For the marketing of essential\ncommodities, in my own words:<\/p>\n\n\n\n

The Department for the Development  of Agricultural Marketing\u201d\u00a6\nensured that prices of all essential commodities were indirectly controlled and\nthe traders were compelled to offer fair prices to the producers and the retail\nshop keepers were compelled to sell at fair prices to consumers.  This is\na system that I have never seen elsewhere in the world\u2019 \u00a6The motto of the\nDepartment was to pay the highest possible price to the producer and sell at\nthe lowest possible price  to the consumer.( From: How the IMF Ruined Sri\nLanka,\u201d\u00a6 (Godages: 2006)<\/em><\/p>\n\n\n\n

 <\/em>I was involved with the entire System\nbecause I was appointed Assistant Commissioner for the Development of\nAgricultural Marketing in 1955, and worked in the Ratnapura, Hambantota,\nAnuradhapura  Districts as well as was in charge of the Tripoli Market,\nthe Headquarters of the Vegetable Marketing Scheme for a year in 1957.<\/p>\n\n\n\n

 <\/em>This System involved a Network of Retail\nShops(Fair Price Shops) in every major city and a Vegetable  and Fruit\nMarketing Scheme involving purchasing, selling and processing  \nvegetables and fruits, a Scheme  that covered the entire island.<\/p>\n\n\n\n

The entire island was covered\nby Assistant Commissioners in the Provinces and Marketing Officers posted in\nproducer areas, who had to report the availability of produce, prices at the\nFairs, and guide producers to plant varieties in demand.<\/p>\n\n\n\n

 <\/h2>\n\n\n\n

The Marketing Department\nestablished Vegetable and Fruit Packing Sheds(actually purchasing units) in all\nproducing areas. The name given was packing sheds and they were in many places\nin temporary buildings mostly made with timber. Even some Assistant\nCommissioners had their offices in these temporary buildings in 1955.<\/p>\n\n\n\n

The entire Vegetable Marketing\nScheme was administered from Tripoli Market, based in the largest hangar in the\nColombo Goodshed.  One part of the Scheme was to purchase vegetables and\nfruits from producers who brought their produce to our Vegetable Packing Sheds.\nThey were paid immediate cash. The Department was equipped with lorries that\nwere sent to the chief  Producer Fairs in the producer areas. Thus there\nwere mobile purchasing uints at all major fairs like Embilipitiya, Colombage\nAra,  Bandarawela, Welimada, Kekirawa to mention just a few. These\nPurchasing Units comprised Marketing Officers and a staff of purchasing\nofficers and labourers. The produce brought in was weighed and accepted from\nproducers and they were paid cash immediately. The Assistant Commissioners of\nthe Districts were required to visit all major fairs to ensure that the\npurchases were made regularly. When I worked in the Districts on most days my\nday commenced at four to get to the Fairs by six in the morning. Vegetables\nwere purchased and packed and dispatched to Triploi by evening either by\nwagons(by trains) or by special lorry.<\/p>\n\n\n\n

At Tripoli Market, the\nAssistant Commissioner  had a Marketing Officer at the Colombo Wholesale\nMarket. His task was to report the prices at which the wholesale traders sold\nthe produce to the retail traders and to report on the availability of produce.\nIn the Districts, the Assistant Commissioners and the Marketing Officers had to\nreport the prices at which private traders purchased vegetables and\nfruit.  Generally there was a wide gap between the prices at which the\ntraders purchased goods and the prices at which the Wholesale Traders sold to\nthe retail traders in Colombo. Based on these prices, the Assistant\nCommissioner at Tripoli Market decided the purchasing prices at which goods\nwere to be purchased at the Fairs. This price was always above the prices\noffered by the traders who bought goods at the Fairs. This helped the producers\nand the traders at the Fairs too had to offer a similar price because otherwise\nthey will be out of business.<\/p>\n\n\n\n

On a daily basis Tripoli Market\nreceived around twenty wagon loads of vegetables and a similar number of\nlorries bringing in produce. These were checked and had to be in our Retail\nshops by ten in the morning.  Tripoli Market was a hive of activity from\nearly morning.  Then the Railways ran a very efficient service and brought\nin produce in time.  For instance curd from Ridiyagama Farm in Hambantota\nwas sent by lorry to Matara and came by night mail train to Tripoli. This was\nan item in high demand. The retail price we fixed for Ridiyagama Curd\neffectively controlled the prices of curd in private shops in Colombo.<\/p>\n\n\n\n

The Assistant Commissioner at\nTriploi Market kept a very low margin to cover up cost of transport and\nhandling and fixed a low price for sales to the consumers through the network\nof Shops. Generally the Marketing Department kept a margin of around 10 to 15%\nabove the purchase price while the private trader at the Fair  kept a\nmargin to 40 to 50% and the Whoelsale Traders too kept around 40% and further\nthe retail trader too kept around 40%.  Thus while the private trader\ngenerally kept a margin of 100% or 120% over the purchasing price at the Fair,\nthe Marketing Department kept a margin of 10% to 15%.  <\/p>\n\n\n\n

The working of the Marketing\nDepartment  meant that the private traders at the Fairs and the Wholesale\nTraders as well as the Retail Traders in the cities had to be satisfied with a\nlow margin.<\/p>\n\n\n\n

The Marketing Department in the\nFifties was headed by BLW Fernando, a Chartered Accountant and he would not\nallow any Assistant Commissioner to keep a higher margin than 15%. That was a\nrule to be followed. Every month all Assistant Commissioners had to attend a\nConference where the Profit and Loss calculations were closely studied and the\nCommissioner would chastise all Assistant Commissioners that  had a profit\nof over 10% or incurred a loss.  We were expected to cover up, not to\nincur a loss or  to get a large profit.<\/p>\n\n\n\n

This was the key method by\nwhich the prices of vegetables and fruits were kept in check. The Scheme has\nthus a dual aim- of offering the producer a fair price as well as offering the\nconsumer a low price.  At times it was like walking on a rope but we got\nused to walk on it.<\/p>\n\n\n\n

The Retail Shops had to be well\nstocked and full of goods otherwise the wrath of the Commissioner had to be\nfaced.<\/p>\n\n\n\n

A few years ago on one of my\nvisits I found tomatoes being sold at forty rupees a kilo by a producer on the\nMahiyangana Road, when the retail price in Colombo was around rupees eighty to\none hundred, a margin of over hundred percent. This could not happen while the\nMarketing Department was at work. The Assistant Commissioners  were\neternally traveling as they had to visit Fairs, inspect purchasing at the Fairs\nand the Vegetable Purchasing Depots, contact producers and offer advice on\nitems on demand. Generally our traveling allowances exceeded our salaries.<\/p>\n\n\n\n

Tripoli Marker had cold rooms\nwhere the excess produce could be stored.<\/p>\n\n\n\n

This Vegetable Marketing &\nFruit Marketingh Scheme  was very successful in ensuring that consumers in\ncities obtained vegetables and fruits at cheap rates. The Cost of Living was\neffectively kept in check.<\/p>\n\n\n\n

 The Canning Factory<\/p>\n\n\n\n

Local producers got a boost\nwith the establishment of the Canning Factory in 1955. At that time Sri Lanka\nimported fruit juice and fruit from Australia and the task of the Canning\nfactory was to produce fruit juice, jam and jellies. The Vegetable Purchasing\nCenters sent goods to the Canning Factory. At the initial stages in canning\nfruit juice many problems were faced and it took over a year to surmount them\nand get down to production for all Sri Lanka\u2019s requirements. The Marketing\nDepartment offered  floor prices for pineapples, red pumpkin and ash\npumpkin and producers benefited immensely. Floor prices meant that the\nDepartment will purchase everything offered at that price. Pineapple was tinned\nand even an export trade was built up. Assistant Commissioner Oswald\nTilekeratne spread his wings abroad very often. Red Pumpkin was turned into\nGolden Melon Jam and Ash Pumpkin was turned into Silver Melon jam. The Factory\nactivity made Sri Lanka self sufficient in fruit juice, jam and many other\nprocessed food within a few years.<\/p>\n\n\n\n

The Marketing Department was called upon to attend to many\ntasks.<\/h2>\n\n\n\n

Once Sri Lanka was not self\nsufficient in eggs. The Marketing Department offered a floor price for eggs and\nTriploi Market collected eggs from the Negombo-Nattandiya area till Sri Lanka\nwas self sufficient in egg production. Once Self sufficiency was  reached\nthe scheme was disbanded.<\/p>\n\n\n\n

With the abolition of the\nMarketing Department, and the privatization of the canning factory all this\nachievement was lost. That was the way in which the IMF crippled the\ndevelopment of the Third World and created a situation where we had to import\nour requirements from the Developed Countries.<\/p>\n\n\n\n

Once the tomatoes producers at\nHanguranketa made pandals of tomatoes in order to highlight their plight of not\nbeing able to sell their tomatoes. This could not have happened while the\nMarketing Department was functioning. To start with the Assistant Commissioner\nof the area would be held responsible. If that happened when I was in charge of\nThe Tripoli Market I would have sent a few lorries and the entire stock of\ntomatoes would have been purchased within a few hours and it would have been\nturned into Tomatoe Sauce and Juice at the Factory. The MD had a fleet of over\na hundred lorries. Today Spain produces tomatoe sauce, tomatoe juice, tomato\npaste and sun dried tomatoes for most countries in Europe. With a Tomatoe belt\nin Hanguranketa we cannot produce tomato sauce even for our requirements. Our\nclimate had enabled a variety of crops. There is a mango belt from Anuradhapura\nto Matale. Even today if action is taken to pluck mangoes and process it, we\ncan be self sufficient in all fruit juice within one year. The Chena\ncultivators will find sales for their Red Pumpkin,Ash Pumpkin and Melon. There\nis an Avacado belt from Peradeniya to Gampola and avacado juice can easily be\nmade. The country will benefit by avoiding the millions spent on imports.<\/p>\n\n\n\n

Following the liberalization\nfree market economics of the IMF we  created a market for tomatoe sauce\nfrom the USA, and fruit juice from as far as Canada and Oregan in the\nUSA.  Our producers have stopped producing large quantities for fear of\nbeing unable to sell and we have unemployment and our farmers have low incomes.\nThe Colombo Supermarkets are full of Heinz Tomatoes sauce from the USA and\nfruit juice and jam from Australia.Even vinegar from the USA! The IMF did its\nwork right to cripple development in our countries and for us to buy goods from\nthe Developed Countries.  That was the Structural Adjustment Programme in\naction. (For more details: How the IMF Sabotaged Third World Development:\nKindle & Godages) It is sad that we have   deaf, dumb and\nblind  economists who even fail to come to grips with how we were duped by\nthe IMF.<\/p>\n\n\n\n

I hope the Army will be\nenlisted for this task of marketing development. In President Trump\u2019s USA the\nArmy is widely used for irrigation, power station construction, even\nmaintaining levees that keep the sea from flooding New Orleans. In my wide\ntravel in the USA, clocking over 50,000 miles in my Roadtrek motorhome,\ncrossing America thrice I have seen the Army at work doing non military duties\non a regular basis. It is we fools that do not enlist the Army for development\ntasks. If at all we touch the army we call them to the barracks in a short\nwhile.<\/p>\n\n\n\n

Let the Army experience of Van\nSales, this time end with the establishing of a proper Marketing Department\nwith a Cannery. The total cost of establishing a Cannery can be easily recouped\nin the very first year by the savings of foreign exchange we use today to\nimport fruit juice and fruit preparations   Later on the Army venture\ncan be handed over to a SLAS Department and the Army moved to another task-\nperhaps the reconstruction of our irrigation tanks.<\/p>\n\n\n\n

Let me live in hope.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

By Garvin Karunaratne The Hon President may please  consider getting the Army to establish the Marketing Department of the Fifties and thereby enable vegetable availability as well as controlling inflation. It can be later developed to be a major department. The total outlay can be recouped including the cost of establishing a Cannery within the […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[57],"tags":[],"class_list":["post-107156","post","type-post","status-publish","format-standard","hentry","category-by-garvin-karunaratne"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/107156","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/comments?post=107156"}],"version-history":[{"count":0,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/107156\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=107156"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=107156"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=107156"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}