{"id":96144,"date":"2019-12-08T17:09:20","date_gmt":"2019-12-09T00:09:20","guid":{"rendered":"http:\/\/www.lankaweb.com\/news\/items\/?p=96144"},"modified":"2019-12-08T17:09:20","modified_gmt":"2019-12-09T00:09:20","slug":"innovate-or-perish-the-future-of-the-paddy-farmer","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2019\/12\/08\/innovate-or-perish-the-future-of-the-paddy-farmer\/","title":{"rendered":"Innovate or Perish: The future of the paddy farmer"},"content":{"rendered":"

Courtesy Island<\/em><\/span><\/h2>\n\n\n

December 8, 2019, 9:20 pm\n<\/p>\n\n\n\n

\"article_image\"\/<\/figure>\n\n\n\n

By D. C. P. Amarasekere
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In\n Sri Lanka, the paddy farmer who is central to the \u2018nation\u2019 has been \ncruelly displaced in national policy for decades. Most Sri Lankan \npolitical leaders remember the farmer in cycles, and it typically \ncoincides with an election. Every election season the farmer makes a \ncome-back, front and center, on election agendas. The candidates vie \nfor the 2 million plus farmers\u2019 votes almost like in an auction, each \noutbidding the other, by using bigger and better subsidies and \nhandouts. The fertiliser subsidy and the buying rate for paddy are the \ntwo most salient grievances that dominate political debates. To set the\n record straight, there is a wide gap between the “farm-gate price” (the\n price that farmers get for selling paddy), and the price which \nconsumers pay for rice. However, this is always exaggerated. While the \ngap between the consumer price and the farm-gate price ranges between \n20-30%, the farmers, politicians, and NGOs imagine this to be as high \nas 100%. The exaggeration may not have an empirical basis, but it helps\n demonize the exploitative forces such as banks, millers, retailers and\n other intermediaries in the paddy-rice value chain. The seasonal \ndemonization helps with self-preservation, not limited to-, but \nparticularly of politicians. The symbiotic relations between politicians\n (at all levels) and business interests notwithstanding, political \ncandidates market themselves in theatrical fashion as brave soldiers \nfighting to eliminate the exploiters from the paddy-rice value chain \nand restore the rightful dignity of the Sri Lankan farmer. After the \nelections, the status quo resumes.
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Given that the \nnewly-elected President Gotabaya Rajapaksa presented the most \ncomprehensive set of policies, programmes and initiatives in the area \nof agriculture during his campaign, it is important that we hold him, \nthe Minister of Mahaweli, Agriculture, Irrigation and Rural Development \nin the interim cabinet \u2013 Mr. Chamal Rajapaksa, the State Minister of \nAgriculture \u2013 Mr. Vidura Wickramanayake, and the government accountable\n to deliver on the much-needed reforms in agriculture. The newly \nelected President has walked into a putrid political system as well as \nan economy at the brink of a collapse. However, some quick measures \nneed to be taken to address the crisis in agriculture in Sri Lanka. \nThis article is intended to highlight a couple of “stylized facts” \nabout income and labour of paddy-farming households in order to push \nthe agenda beyond the fertiliser subsidy and the farm-gate price. The \ndeclining welfare among farming households and opportunities for farmers\n give a clear indication that we have to innovate in order to survive.
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Farming Households Always Operate at a Loss
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First,\n let us look at the basic balance sheet of a farmer. This calculation \ncarries two disclaimers: 1) the numbers are derived from day-to-day \nconversations with farmers over the past couple of decades in a village \nin the Hambantota District, but accurately reflect the figures for the \nMaha season of 2018; and 2) perhaps contrary to popular understanding, \nthe vast majority of smallholder paddy farmers employ agricultural \nlabour for most farming-related tasks. In this village, on average, a \nfarming family cultivates between 1-1.5 acres of paddy land. From \ncultivation to harvesting, a paddy season lasts roughly 5 months. On \naverage, to cultivate one acre of paddy, a farmer incurs the following \nexpenses (per acre of paddy):
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Second, let us calculate how \nmuch the paddy farmer (who cultivates one acre of paddy), earns at the \nend of the 5-month season. Based on national figures, the paddy harvest\n per acre during the 2019 Maha season was roughly 1,900 kilos. If the \nfarmer sells his harvest to the government at the current price of Rs. \n38, he\/she will earn an income of Rs. 72,200 at the end of the 5-month \nseason.
<\/p>\n\n\n\n

It is interesting to note that the farmer\u2019s average \nmonthly income during the season seem to be barely above Official \nPoverty Line (OPL) in 2016 which is Rs. 4,166. In conversations with \nfarmer households (consisting of two adults and two children), the \nmonthly expenditure was recorded as follows:
<\/p>\n\n\n\n

This means, \nfarming households incur a loss of Rs. 431\/day, Rs. 12,930\/month, and \nroughly about 1.5 lakh per year. This loss is always settled by \nincurring debt, borrowed mostly from local loan sharks at exorbitant \ninterest rates. Year after year, the debt increases, as the earnings \nare rather low. While this is a simplified view of the infamous \u2018farmer\n debt\u2019 issue, it gives a rough idea of the sustained nature of debt in \nfarmers\u2019 lives. Many of them die indebted to a number of creditors, and\n not all of them are banks. A Sri Lankan farmer, at the end of his \nlife, may owe 2-3 million or sometimes even more. The debt that is owed\n to individuals who typically tend to be \u2018strongmen\u2019 in the area, is \nautomatically transferred to the wife and the children of the farmer. \nFarmer debt is a never-ending cycle that is of inter-generational \nnature.
<\/p>\n\n\n\n

Alternatives and the Role of the Government
<\/p>\n\n\n\n

One\n cause of this bleak situation of the paddy farmer is the extremely low\n productivity. Compared to other South Asian and Southeast Asian \ncountries, Sri Lanka\u2019s productivity is significantly low. But one should\n not be fooled to think that improving \u2018productivity\u2019 simply means an \nincrease in rice production. \u2018Improving productivity\u2019 means increasing \nyields and cutting the cost of production simultaneously. In fact, \nproducing more and more rice is counterproductive. An excess supply of \nrice to the market causes prices to fail, which in turn does not help \nthe farmers\u2019 situation. If the price falls below the cost of \nproduction, the farmer incurs losses and struggles to pay the debt he \nhad accumulate during the season and any arrears from previous seasons. \nOne important point that current and future policymakers need to \nunderstand is that the demand for rice is flat. In other words, there \nis only so much rice that we can eat, and for the past 20 years, the \naverage annual consumption of rice has been approximately 110 Kilos per\n person. This means the domestic consumers are incapable of absorbing a\n glut of rice on the market.
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While the next option is to \nexport rice to foreign markets, it is easier said than done. For \ndecades, the global market preferences have been in favour of \nlong-grain cultivars such as Thai, Pakistani and some Indian rice \nvarieties. The demand for the Sri Lankan short-grain varieties is \ncomparatively very low as they do not appeal to the palette of rice \nconsumers in most other countries, nor can they be used in recipes in \nthe gourmet food or fast food products. A new demand, however, can be \ncreated (globally) on the basis of the health benefits of eating Sri \nLankan varieties of rice, but this would require a well thought out and\n medium- and long-term branding and marketing programme at the \nnational- and international levels. As the investment on such a strategy\n would be substantial, we must maximize our usage of rice and its \nby-products such as paddy husk, rice bran, and broken rice.
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Approximately\n 575,000 metric tonnes of rice husk is produced in Sri Lanka every \nyear, and utilizing and disposing this low-value by-product as been a \nchallenge for millers and farmers. However, paddy husk has been \nsuccessfully used as a soil conditioner for mulch, and as a biofuel for \n furnaces. It is also used for insulation and as packaging material, a \ncleaning agent for steel and iron, a raw ingredient in producing \ncement, and fillers for the plastic industry. Paddy husk has been used \nas fuel in several industries, especially in rice processing mills. \nFurthermore, rice bran has been successfully used to produce rice bran \noil which has a number of health benefits as well as a growing demand \nin the international market. Similarly, broken rice can be used to make\n cereals and health drinks. Rice can also be used to make liquor such \nas sake in Japan. Regrettably, most of these ventures are not \nundertaken in Sri Lanka. These ventures may be too capital-intensive for\n farmers to undertake, but they offer new avenues of income for millers\n and other intermediaries. The idea is not to demonize the millers and \nthe other intermediaries in the rice value-chain in Sri Lanka, but to \ncreate opportunities and markets for all stakeholders. Having said \nthat, the millers and other intermediaries need to be regulated, taxed,\n and their employees must be paid EPF\/ETF. An uncontrolled mushrooming \nof millers has led to frequent fluctuations of millers\u2019 income, which \nin turn has led to a high degree of precarity in the labour they \nemploy. If they are given opportunities to produce new value-added \nitems for export, it could create a win-win situation in which the \nmillers\u2019 incomes are increased and stabilized, and the state coffers \ngain foreign exchange. As the millers do not have the technological \nwherewithal, the government must take the initiative to introduce small\n production plants that are used in other parts of the world to \nentrepreneurs in Sri Lanka. Last week, the new President, in an \ninterview on the state\u2019s role in supporting technological innovation \nspoke convincingly about the state\u2019s role in putting in place the basic\n infrastructure that is necessary for such innovation. This suggestion,\n I believe, fall under the umbrella of the \u2018basic infrastructure\u2019 that \nis necessary for innovation in agriculture. The state, together with the\n private sector, would have to assist with marketing new agricultural \nproducts in the global markets until the required marketing skills are \ninculcated in the new generation of agricultural entrepreneurs in Sri \nLanka.
<\/p>\n\n\n\n

If producing more rice does not necessarily improve \nthe lot of farmers, what can the government do to help their household \neconomies? The key to cracking this lies in maximizing farmers\u2019 labour.\n A farmer works only 20 days in a 5-month period. This goes back to a \npoint made earlier in this article that the vast majority of \nsmallholder paddy farmers employ agricultural labour for most \nfarming-related tasks. One might ask, what he\/she does during the \nremaining 130 days. The blunt answer is \u2013 nothing. This has been the \npattern over the years, and regrettably, it has become a part of the \nrural farming culture. The solution to improving farmers\u2019 incomes lies \nnot in increasing the value of handouts or free inputs of production, \nbut in allocating their under-utilized time for producing high-value \nagricultural products.
<\/p>\n\n\n\n

Many innovations can be proposed in \nthis respect. For example, in the dry zone where kohomba (azarirachta \nindica) and mee (madhuca longifolia) trees grow in abundance, farmers\u2019 \ncan be allocated state land to grow mee for medicinal purposes and \nkohomba for timber. Kohomba and mee seeds can be used to produce \nfertilizer, cosmetic products and biofuels. Similarly, farming \ncooperatives can be encouraged to produce wood apple and other fruit and\n vegetable varieties that are indigenous to the area. Ranawara, Beli \nflowers, Murunga and other herbal parts can be processed into fine teas\n for which there is increasing global market demand. Cultivating rare \nand indigenous plant and flower varieties that have international \nmarket value (such as cactus) is another viable enterprise. A quick \nglance at the trees, herbs and flowers that grow in the northern and \nsouthern dry zones in the country suggests that many value-added \nagricultural goods can be produced by farmers in both regions. With two\n international airports in the southern and northern tips of the \ncountry, these products could be easily transported by air to any \ncountry in the world. State support for farmers to move into \nvalue-added agricultural products should open up opportunities to unite\n farming interests of the south and the north of the island. Those who \nare inclined to use their time on manufacturing non-agriculture related\n products can be encouraged towards brickmaking and producing cement \nblocks for construction. To guard against an over-supply of \nagricultural produce of the same kind in a given season (eg. an excess \nof pumpkin because everyone is growing pumkin), the state can regulate \nby maintaining an upper limit of production for each crop. The point is\n to make productive use of farmers\u2019 underutilized time and encourage \nthem to move into value-added agriculture, however, guarding against \nthem flooding the market with the same kind of produce. All this needs \ncareful planning, taking into consideration the terrain, climate, soil,\n access to water, and the skills of farmers in a given region. Monetary\n support for such ventures can be implemented through Anyonyadara \nSamithi in rural areas that already operate as community development \nmechanisms.
<\/p>\n\n\n\n

The options are many. It is the government \ninitiative and the support in terms of creating markets and branding \nthat is much needed. The job of the President who is committed to \nagriculture and competent Minister and State Minister of Agriculture \nmust be to explore these avenues of innovation and work with farming \ncommunities to diversify agricultural production. It is the \nresponsibility of the Minister and the State Minister of Agriculture, in\n collaboration with the private sector, to find international markets \nfor these products, work on a long-term branding plan for Sri Lankan \nagricultural products, and improve connectivity to transport the \nproducts from the farm to the table. In other words, there is a lot \nmore we could try as a country before we call agriculture a “failure”.
<\/p>\n\n\n\n

The\n farmers also have to do their part and meet the government halfway. \nThey have to snap out of the dependency mentality. The dependency of \nfarmers is not figment of capitalist imagination. It is a reality \ncreated by politicians to exercise control over the farming population \nover decades since the country\u2019s independence. The fertiliser subsidy \nin Sri Lanka dates back to 1962 is a case in point. Its main objective \nwas to make access to fertiliser easy and affordable to farmers, \nthereby stimulating high-yields in paddy. Since then, however, despite \nboth the contribution of agriculture to the country\u2019s Gross Domestic \nProduct (GDP) being just 7%, and the massive expenditure on providing \nthe fertiliser subsidy (currently Rs. 15 billion), no government has \nmoved to suspend the system. This is because as much as one-third of the\n labour force is employed in the agricultural sector, and the large \nvoter base of farmers (around two million) immediately made the subsidy\n into a highly ideological political tool crucial to state-building. In\n addition to fertilizer, other inputs of production, are also \nsubsidized, if not provided free of charge. We have now reached a point\n at which the farmers\u2019 safety net has turned into a hammock that lulls \nable-bodied people into lives of complacency and dependency. Most Sri \nLankans would agree on the basic level of not wanting their tax rupees \nused to fund complacency and further indebtedness among farmers. The \nfarmers have to realise that and take control over their lives that \nhave been on autopilot for too long.
<\/p>\n\n\n\n

If the new President \nand his government are serious about making any noticeable difference \nin the farmers\u2019 lives, the agenda has to go beyond the fertiliser \nsubsidy and the purchasing rate of paddy. It is time to step out of \nthis comfort zone, and explore creative ways to secure the vote-base of \nfarmers. Some proposals above may not be the most comfortable options \nin the short-term, but they are necessary if we are to envisage a \nfuture of agriculture in Sri Lanka. The government\u2019s and farmers\u2019 \nfailure to innovate in agriculture will only expedite the process of \ntransitioning to the hands of global agribusiness. Before we know it, \nour land and labour will be controlled by global agribusiness, \nespecially in the face of agreements such as the MCC. But if we utilize\n our land and labour more effectively, this process can be slowed. The \nchoice is ours. Innovate or perish.<\/p>\n","protected":false},"excerpt":{"rendered":"

Courtesy Island December 8, 2019, 9:20 pm By D. C. P. Amarasekere In Sri Lanka, the paddy farmer who is central to the \u2018nation\u2019 has been cruelly displaced in national policy for decades. Most Sri Lankan political leaders remember the farmer in cycles, and it typically coincides with an election. Every election season the farmer […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-96144","post","type-post","status-publish","format-standard","hentry","category-politics"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/96144","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=96144"}],"version-history":[{"count":0,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/96144\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=96144"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=96144"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=96144"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}