Officially known as the Democratic Socialist Republic of Sri Lanka, it is a South Asian country possesses GDP of about $ 85 billion according to the statistics of world bank. Over the past few years, the contribution of agriculture sector in Sri Lana’s GDP has experienced a rising trend. According to the latest report of statista, agriculture sector accounts for approximately 9 percent of Sri Lanka’s total GDP. Major crops are rice, tea, coconut, rubber, maize, wheat, potatoes, chili and beans. 52 percent of the total exports are based on garments and textile products. Tea accounts for 17 percent of total exports and 53.3 percent of agricultural exports. It contributed annually about $ 1.3 billion to country’s exports before the arrival of economic crises in Sri Lanka. Rest of the exports volume is distributed among fish, rubber, gems and spices etc. However, the decision to go for organic agriculture has stalled the production of multiple agricultural crops which has further exacerbated the economic difficulties for Sri Lanka. Therefore, the purpose of this case study is to examine whether organic agriculture itself is a technique that leads to adverse economic consequences on a country or there is something wrong with the planning and strategies which made organic agriculture ineffective for Sri Lanka so that it can be determined that organic agriculture is still useful or not in today’s living habits after what it has done to Sri Lanka.

            In June 2022, the then prime minister of Sri Lanka acknowledged the collapse of country’s economy before the Parliament leaving it insufficient to afford for the essentials. Later on after investigation of this economic catastrophe, various reasons were identified for pushing the country in to economic turmoil. One of the main reasons was organic agriculture. President Gotabaya Rajapaksa had an ambitious goal of transforming Sri Lanka into first country having 100 percent organic agriculture. He used this motto in his election campaign of 2019. Few months after he became the president of Sri Lanka in November 2019, he imposed a complete ban on the imports of pesticides and synthetic fertilizer on April 26, 2021. An year later, country was facing the crises of supply shortage. The production of rice dropped to 20 percent which compelled Sri Lanka to import rice by spending $ 450 million to meet the demand. Moreover, the prices of rice rose up to 50 percent. Tea industry being the major source of Sri Lanka’s foreign exchange suffered the financial loss of $ 450 million. Government had to pay significant amount to farmers and in subsidies to compensate the loss of low productivity. According to a report of foreign policy, about half million Sri Lankans had to sunken below the line of poverty after COVID-19 and Sri Lanka’s economic crises which was intensified by agricultural crisis. Moreover, according to WFP (World Food Programme) report of July 2022, on average three out of ten persons in Sri Lanka are  insecure to food which cruises to a total of approximately 6.26 million people of total population.

            Many commentators blame organic agriculture for economic crises in Sri Lanka, however there are number of underlying reasons including mismanagement by government, tourism, interference of China, economic crimes, violation of human rights and scarcity of foreign reserves behind this economic default.

          The President Gotabaya Rajapaksa banned the import of synthetic fertilizers and pesticides on April 26, 2021. He decided it overnight in a hurried manner without listening to the concerns of farmers. During his election campaign, Gotabaya kept highlighting his pure intentions to go for organic agriculture but he would argue that such a transition from conventional to organic agriculture would take place under a steady period of ten years so that all the farmers can have enough amount of time to adjust into organic agriculture. Moreover, he believed that agricultural chemicals and pesticides were steering the country towards the challenges of health and environment. There was a perception that a kidney disease named as Konketiyawa killing 20,000 farmers in Sri Lanka during last two decades was chiefly because of  impure chemical based availability of agricultural food products. Gotabaya argued that industrially manufactured agrochemicals were against the Sri Lanka’s legacy  of having sustained systems of food. Gotabaya wanted to save $ 400 million which country used to spend on the imports of agricultural chemicals and pesticides. Therefore, he considered it appropriate to take the overnight decision of shifting towards organic agriculture. So, millions of farmers had no choice but to opt for organic means for cultivation. The production of natural fertilizers at domestic level was not sufficient to compensate all the farmers. The matter did not finish there. Government did not import extra nutrients to meet the requirements of farmers for organic transition and it also put complete ban on the imports of fertilizers. Consequently, farmers were confronting the scarcity of fertilizers and pesticides in growing crops and the results were immediately witnessed in shape of serious ruination of crops productivity. Therefore, the root cause behind agricultural collapse was not organic agriculture itself, indeed it was due to the improper implementation techniques including insufficient arrangements for organic agriculture.

              Being sustainable form of cultivation, organic agriculture finds its importance owing to the economic and ecological reasons. Notable surge in organic cultivation has been witnessed  during the last decade across the world. 20% food market of USA and Canada, and 7.8% food market of Europe is based upon organic food. IFOAM (International federation of organic agriculture movement) issues guiding principles for the countries to opt organic agriculture. Organic agriculture is useful in reducing erosion of soil, requires lesser use of pesticides, reduces the leaching of nitrate into groundwater, and endorses recycling of animal waste for the nutrients purposes to the crops. It contributes in improving health of soil and biodiversity.

             Besides number of benefits of organic agriculture, it is argued that organic agriculture decreases the productivity of crops. Dalhousie University of Canada’s  research demonstrates that output productivity gap between conventional and organic agriculture is rapidly closing. In some cases, output productivity of organic agriculture exceeds the productivity of conventional agriculture. 40 years of research conducted by Rodale Institute, America’s largest side by side comparison between conventional and organic agriculture, unveils the fact that after five years of transition, yields through organic agriculture equalizes conventional agriculture. Because of its low production costs, it yields 3 to 6 times greater profit for farmers as compared to conventional agriculture. 45% less energy is consumed and it leaches no toxic chemicals to waterways. Therefore, organic agriculture if implemented properly, leads to sustainable, sufficient and profitable means of production.

             The world is confronting severe environmental effects in form of melting glaciers, changing raining patterns, scorching summers, floods, forest fires, storms and tornadoes. Shifting towards sustainable means of production and consumption is one of the major weapons that can be utilized in order to address these dilemmas. As organic agriculture is one of the sustainable means of production, therefore it should be experimented at first in those regions having lesser population and are economically developed so that in case of low productivity, states may not have to face food crises. Secondly, It should be adopted in phases after analyzing the outcomes in a certain area instead of immediately forcing entire country into rapid transition as in case of Sri Lanka. In areas of drought, organic agriculture should be given priority over conventional agriculture because of its high productivity. So, due to Sri Lanka’s terrible experience with organic agriculture, the significance of organic agriculture has not minimized in modern world. Therefore, pertaining to all these significantly affirmative aspects of organic agriculture, it is not wise to say no more organic agriculture in modern living habits. In fact, organic agriculture is need of the modern world for environmental friendly and healthy lifestyle.

ECONOMYNEXT – Sri Lanka President Ranil Wickremesinghe has issued an order allowing broken rice to be imported for animal feed as poultry farmers faced difficulties in getting maize and chicken and egg prices soared amid a currency crisis.

Under a gazette notice issued by Wickremesinghe in his capacity as Minister of Finance, up to 25,000 metric tonnes of broken rice would allowed to be imported.

Sri Lanka has faced difficulties in importing maize, which has been under import licensing for many years to give high profits to special interests involving a collector lobby, keeping domestic meat prices high.

President Wickremesinghe earlier allowed maize to be imported by feed millers under open account, but the companies were unwilling to do so, according to poultry industry officials.

Sri Lanka’s imports were disrupted and prices soared as the rupee collapsed from 200 to 360 to the US dollars after two years of money printing, in the worst currency crisis triggered by the island’s intermediate regime (soft-pegged) central bank.

Currencies collapse due to mis-targeting of interest rates through a policy rate or other means. (Colombo/Oct26/2022)

CHEDDIKULAM, SRI LANKA — Sellan Yogarasa returned to Sri Lanka in 2014, after more than two decades of exile in India. He leased 9 acres of agricultural land and began growing rice, a staple food for the island’s 22 million inhabitants. A harvest typically yielded about 288 bags of paddy, each weighing 25 kilograms (55 pounds), enough for a decent livelihood. But overnight this calculus crumbled for Sellan — and for many others in the Sri Lankan labor force, over a third of whom are involved in the paddy sector.

In May 2021, the government banned agrochemicals, with the professed aim of becoming the world’s first country free of chemical fertilizer. A year on, as the country reaps the consequences of that decision — while also grappling with a broader economic crisis — its new prime minister has warned of an impending food shortage.

Sri Lanka harvests rice twice a year, contingent on its two monsoon seasons. During the maha cycle — maha means “bigger” in Sinhala — rice is sown in September and harvested by March, while the yala, or “lesser,” cycle begins in May and ends by August. Although the agrochemical ban was partially rolled back in November, its impact on the island’s ability to feed itself was immediately evident. Rice imports in Sri Lanka, which is usually self-sufficient in its staple crop, leaped from 15,770 metric tons in 2020 to 147,091 metric tons in 2021, and more than 90% was imported in the last two months of the year. Nationwide data is not yet available, but experts estimate that the rice harvest could decline by about 33%.

Across northern Sri Lanka’s Vavuniya district, the average annual paddy yield has decreased from 101,831 tons to 49,218 tons following the ban on chemical fertilizers, says Nesarathinam Vishnuthasan, assistant commissioner at the district department for agrarian development. The Ministry of Agriculture and the Ministry of Trade didn’t respond to requests for comment.

Sellan, 63, says his yield plummeted by more than 60%. His 9 acres produced just 108 bags of paddy, a decline so precipitous that this season he is only cultivating groundnut, a legume crop that he says doesn’t require chemical fertilizer.

Farmers are not necessarily opposed to organic farming. A nationwide survey of farmers in July 2021 by Verité Research, a Colombo-based research firm, indicated a majority (64%) favored moving away from agrochemicals, but a higher number (78%) requested more than one year to transition. Eighty-five percent of surveyed farmers predicted a decline in harvest. Sellathambi Sritharan, head of a farmers federation in Vavuniya district, says organic agriculture is welcome but should not be forced upon farmers — especially overnight.

“It will take some time,” he says, “for the soil and man to get used to organic farming.”

Ninety-four percent of paddy farmers use chemical fertilizer, according to Verité Research, and many don’t have sufficient knowledge of organic alternatives. Kantaiya Kanagalingam, 62, has been cultivating rice for 25 years but struggled to sustain yields without chemical fertilizers. “In all my years, the last harvest was the only time I saw a massive drop in yields,” he says, gloomily spraying pesticide on fledgling stalks. They are pale and drained of color, he says, because of deficiency in soil nutrients, due to the limited application of fertilizer.

Selvarathinam Santhirasegaram, an economics professor at the University of Jaffna, says the government will have to make peace with agrochemicals for now if it wants to resuscitate local production and limit its import bill.

“Food is essential for survival,” he says.

Despite a rollback of the ban — which was ostensibly imposed to tackle chronic kidney disease among farmers, though the country’s dwindling foreign reserves may also have been a factor — supplies remain limited, partly due to a global spike in prices.

According to the United Nations, global fertilizer rates have increased by more than half in the past year, a spillover effect of the Ukraine crisis, since Russia and Belarus are the world’s second- and third-biggest producers of potash, a key fertilizer ingredient — and due to Sri Lanka’s depleted coffers. In Vavuniya district, the price of urea, a low-cost nitrogen fertilizer favored by local farmers, has increased by a factor of 25, says Antony Kamilas Mathusan, a local seller.

“Farmers who bought 50 or 100 kilos of fertilizer now buy 5 or 10 kilos after hearing the price,” he says.

The government announced compensation for those affected by last year’s ban, but Vavuniya farmers say they have yet to receive any. The nationwide political and economic crisis has led to delays, says Nesarathinam. Sellan intends to cultivate rice on just 1.5 of his 9 acres next season unless fertilizer prices decline or are further subsidized by the government. If other farmers make similar reductions, it’s likely to prolong the island’s food crisis.

THAYALINI INDRAKULARASA, GPJ SRI LANKA

Kantaiya Kanagalingam sprays his paddy crop with chemical fertilizer in mid-May. The government imposed a short-lived ban on chemical fertilizer last year.

Meanwhile, the market price of rice has also skyrocketed — from 145 Sri Lankan rupees (40 cents) per kilogram in May 2021 to 230 rupees (64 cents). Sellathurai Mohanadevi, who sells ilia kanji, a traditional herbal gruel made from raw rice, coconut milk and leafy greens, saw his customers dwindle when he raised the price by 10 rupees (3 cents). “I do not know how to live with the current price,” he says. He has resorted to skipping a meal each day.

Earlier this month, on Twitter, Sri Lanka’s new prime minister, Ranil Wickremesinghe, acknowledged the country’s declining harvests. “Around $150m [million] is required for our monthly food imports,” he wrote. “We require around $600m a year to ensure an adequate supply [of] fertilizer for our local and export crops. We are working on international assistance to obtain this.”

Sri Lanka’s crisis, albeit aggravated by government missteps, reflects a worldwide emergency. Global hunger has reached unprecedented levels, the U.N. has warned, with the number of severely food insecure people doubling in just two years, from 135 million before the pandemic to 276 million as of May 2022. “At today’s prices, farmers cannot afford seeds, fuel and fertilizers,” U.N. Secretary-General António Guterres said last month. “There is no effective solution to the food crisis without reintegrating Ukraine’s food production, as well as the food and fertilizer produced by Russia and Belarus, into world markets — despite the war.”

Sellan’s 90-year-old mother, Sellan Valliyammai, remembers the last time there was a food crisis of the sort now looming over Sri Lanka — decades ago, in 1974. Villagers rose before the sun to line up for rice, wheat and sugar. Mothers despaired over hungry children. She doesn’t want to revisit that time, even in her memories. Nor does she want her children and grandchildren to experience anything like it.

Thayalini Indrakularasa is a Global Press Journal reporter based in Vavuniya, Sri Lanka.

Crisis-hit Sri Lanka has decided to import 50,000 metric tonnes of rice under the Indian credit line to curb an abnormal rise in rice prices, Prime Minister Ranil Wickremesinghe said on Thursday

Crisis-hit Sri Lanka has decided to import 50,000 metric tonnes of rice under the Indian credit line to curb an abnormal rise in rice prices, Prime Minister Ranil Wickremesinghe said on Thursday, as the island nation is grappling with an impending food shortage.

The decision was taken after a discussion held at the Prime Minister's Office to allocate funds to the State Trading Corporation under the Indian loan assistance programme, news portal EconomyNext reported.

This is expected to avert a possible rice shortage in the future and to curb the abnormal rise in rice prices, the Prime Minister's Office said in a statement on Thursday.

In March, India extended a USD 1 billion credit line to the cash-strapped Sri Lankan government to tide over the current economic turmoil as well as in dealing with the food shortage.

After an agreement to extend the line of credit was inked, Ministry of External Affairs (MEA) Spokesperson Arindam Bagchi said India has always stood with the people of Sri Lanka and will continue to extend all possible support to the country.

In April 2021, President Gotabaya Rajapaksa announced a ban on chemical fertilisers, which led to a crippling blow to the production of rice and other essential food items.

Prior to the fertiliser ban, Sri Lanka was self-sufficient in rice production.

The situation was exacerbated by an acute scarcity of foreign exchange reserves, which meant that the Sri Lankan economy would head into a tailspin.

The UN Resident Coordinator in Sri Lanka, Hanaa Singer-Hamdy had said that nearly 4.9 million are currently in need of food assistance, making up for nearly 25 per cent of the country's population.

With Sri Lanka in the throes of an impending food shortage, Wickremesinghe has invited David Beasley, the Executive Director at the United Nations World Food Programme to visit Sri Lanka.

The nearly bankrupt country, with an acute foreign currency crisis that resulted in foreign debt default, announced in April that it is suspending nearly USD 7 billion foreign debt repayment due for this year out of about USD 25 billion due through 2026.

Sri Lanka's total foreign debt stands at USD 51 billion.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

ECONOMYNEXT – Sri Lanka may have to import about 800,000 metric tonnes of rice amid a crop shortfall created by a chemical fertilizer ban in the 2022 main season and under cultivation in the current season, Agriculture Minister Mahinda Amaraweera said.

The 800,000 metric tonnes is enough to meet the domestic demand for about four months.

In a good year, Sri Lanka can produce about 3 million tonnes of paddy which turns out to be about 3.0 million tonnes of milled rice.

Already Sri Lanka had imported 339,000 metric tonnes of rice up to the end of the year, he said.

Sri Lanka’s monthly rice demand is estimated at around 190,000 to 200,000 metric tonnes.

“The current rice stocks are enough to meet the demand for up to about the middle of October,” Minister Amaraweera told Sri Lanka’s Derana Television.

“This year’s Yala harvest is estimated to be enough for about two months, due to lower cultivation.”

“That will take the rice availability up to November.”

This year’s Yala season has been hit by fertilizer shortages and diesel for agricultural equipment.

The government is planning to get 65,000 MT of fertilizer from India which can be used in the current season, he said.

However there is late cultivation seen, Minister Amaraweera said with renewed interest in cultivation due to food shortage fears which may take rice availability up to mid-December, he said.

“There is no need to have undue fears that there will be food shortages from August,” Minister Amaraweera said.

“The trade minister is planning to order rice from abroad. It was also discussed at the cabinet today. So we will import the shortfall.

“We will have to import about 800,000 metric tonnes of rice from abroad.”

The Maha main cultivation season starts at the end of the year and harvests begin from around February the following year.

Sri Lanka had seen rice shortfalls of one million tonnes or more in 2016 and 2018 which had been imported.

Global rice prices are now around 375 to 450 dollars a tonne, requiring around 300 to 360 million US dollars to import 800,000 metric tonnes.

Global commodity prices have shot up after US money printing pushed inflation to 40-year highs under the so-called Powell Bubble.

Classical economists have warned for over two years that Fed policy would trigger a commodity bubble and a wide miss in its inflation target. (Conditions ripe for global commodity super-cycle: Steve Hanke)

In the Bernanke-Greenspan bubble which collapsed in 2008/2009 triggering a global economic contraction, several countries banned grain exports.

Minister Amaraweera said Sri Lanka was trying to place import orders early because prices can move up further and there was a danger that rice-producing countries may ban exports.

Though Sri Lanka has easily imported food in the past, now the country is in the middle of a severe foreign exchange shortage, he said.

The government is in the process of raising funds to finance imports from bi-lateral partners, officials have said.

Sri Lanka earns about a billion US dollars through exports, and about 600 million US dollars from remittances where about half comes through official channels. But the balance can be used for food imports anytime open account imports are allowed.

Sri Lanka is currently facing foreign exchange shortages due to monetary instability coming from the lack of a working monetary regime after a soft-peg lost credibility.

Sri Lanka’s central bank has hiked rates to slow domestic credit and reduce outflows. There have been calls to shift away from the unstable intermediate regime which breaks under ‘flexible’ monetary policy to a single anchor regime with tight rules to prevent (Colombo/June07/2022)

Sri Lanka wants farmers to plant more rice as part of plans to avert a severe food shortage, a top official said on Tuesday, as experts warned of a 50% drop in production that would worsen the impact of its already-severe financial crisis.

Sri Lanka is in the throes of its worst such crisis in more than seven decades. The island of 22 million people has run out of foreign exchange reserves and is unable to pay for critical imports including fuel, food and medicine.

“It is clear the food situation is becoming worse. We request all farmers to step into their fields in the next five to ten days and cultivate paddy,” Agriculture Minister Mahinda Amaraweera told a press conference on Tuesday.

Sri Lanka’s new prime minister Ranil Wickremesinghe has warned of a severe food shortage by August and estimates $600 million will be needed to import fertliser, which the country is struggling to raise.

Most fertliser will arrive too late for the next cultivation cycle that usually kicks off in early June, a group of agriculture experts have warned. In the next two seasons, sufficient quantities of fertilizer will not be available to fulfill the nutrient requirements of any of the major crops of rice, tea and maize.

Buddhi Marambe, an agriculture professor at the University of Peradeniya, said some areas will lose more than 50% of the paddy yield even if action is taken.

“Even if we bring fertilizer today, it will be too late to have a good harvest,” he said.

Talks are underway with India to procure 65,000 tonnes of fertliser and appeals have been made to seven other countries, Amaraweera said. But he did not disclose details of when shipments would arrive.

Last month the central bank announced it would “preemptively” default on some of its external debt as the currency depreciated more than 50% and food inflation hit 46% in April.

Reeling under severe economic crisis, the Sri Lankan government is now forced to restrict the import of a host of essential commodities, including food items Colombo: Sri Lanka is already under an unprecedented economic crisis and amid this people being burdened further as prices of food essentials are soaring high. Buying rice has become dearer in the island nation as the price of the foodgrain has risen to "unbearable levels" in the island nation. A report by Colombo Page mentioned consumers in Sri Lanka saying that the minimum price of a kilogram of rice in the general market has now surged Rs 200-240. Reeling under severe economic crisis, the Sri Lankan government is now forced to restrict the import of a host of essential commodities, including food items which has pushed the price of essentials such as milk powder and rice exceptionally high. Meanwhile, the Ministry of Trade says that rice is being sold at concessionary prices by wholesale network Lanka Sathosa outlets, it was learned from several CWE outlets that imported rice was not meeting the mounting demand. The report further said that Sathosa outlets in many parts of the country are in short supply of essential consumer items including rice, dried chillies and other items. In Sri Lanka, consumers have been demanding the government to take steps to reduce prices by importing rice or setting a control price. Sri Lanka is battling a severe economic crisis, with food and fuel scarcity affecting a large number of the people in the island nation. The economy has been in a free-fall since the onset of the COVID-19 pandemic, leading to the crash of the tourism sector. Sri Lanka is also facing a foreign exchange shortage, which has, incidentally, affected its capacity to import food and fuel. The country is facing long power cuts. The country is also witnessing protests over the government's handling of the worst economic crisis in decades. Yesterday, a protest was held outside the US Embassy in Colombo against the Sri Lankan government.  

COLOMBO (IDN) — A recent statement by a Myanmar official has indicated that Sri Lanka has been buying rice from the country at a price higher than what others are paying for it. This has raised eyebrows in Sri Lanka that has prided itself for being self-sufficient in rice, its staple diet, for decades. In a statement attributed to the secretary of the Bayintnaung Rice Wholesale Depot, U Than Oo, Myanmar’s national daily Global New Light of Myanmar has said that in the past year Myanmar has been exporting rice to Sri Lanka and it has been a very profitable business. “Sri Lanka is a neighbour of ours and it is easy to export rice from Myanmar by sea. We sell rice to other countries at USD 340-350 per tonne, but to Sri Lanka we have been able to sell at USD 440-450 a tonne,” U Than was quoted as saying.  While Myanmar has been fetching over $ 100 per tonne above the price paid by other countries, he has also said that the Sri Lankan authorities have not imposed any restrictions on the import of Myanmar rice. “While Sri Lanka imposes no restrictions, Europe and China have been imposing various tariffs and other restrictions to protect their markets,” says U Than. “So, it is somewhat complex to export rice to these countries.” Sri Lanka has signed a memorandum of understanding with Myanmar on January 7 to import 100,000 tonnes of white rice and 50,000 tonnes of brown rice this year and the next. Due to this agreement Sri Lanka would be spending $ 15 million extra on rice imports. According to a Sri Lankan commerce ministry statement, while Myanmar has quoted $ 465 per metric tonne, the Sri Lankan counterparts have been able to negotiate the price down to $445 per metric tonne. Agricultural industry observers here predict that the rice harvest this year (due for harvest in April) could be down by about 30 percent. Today the rice prices in the market have skyrocketed creating social tension in the country. After the fertilizer subsidies to farmers were lifted (after the organic farming policy was announced) and the guaranteed price for paddy was increased to Rs 75 per kilogram, it has made any price controls of rice in the market place impossible. Government has announced that due to domestic market necessities, Sri Lanka would need to import up to 600,000 tons of rice this year. This would be the biggest rice imports to the country for 5 years. The government has also allocated Rs 40 billion ($ 13.8 million) to compensate farmers for harvest losses due to the switch to the organic farming policy. Due to the import of processed rice, United Rice Producers Society (URPS) says that it is threatening the closure of up to 500 small and medium sized rice mills in the country. “Only 75 percent of more than 800 rice mills in our country are in operation right now,” says Kusumitha Muditha, president of URPS. After a long period of self-sufficiency in rice, on November 15 last year when rice imports began to flow in, it has created this situation, he added. It is estimated that only 2.8 percent of farming land in the country use non-chemical fertilizer. After the announcement of the organic farming policy (in April 2021) some businesses have used household waste to make so-called “organic-compost fertilizer” to sell to farmers, which agricultural sources are worried is a fraud misleading farmer. Most of this is compost of food waste and is not helpful to realize Sri Lanka’s organic farming dream. The Central Bank has estimated that the leadership given to the Sri Lankan economy by agricultural activity has been now reduced by 7 percentage points and it has given rise to an agricultural industry that cannot satisfy farmers or consumers. It has come to a situation that seeds and fertilizer necessary for farmers are hard to obtain. Most of the farmers in Sri Lanka do not own the land on which they farm. Out of the productive land in Sri Lanka, government owns 82 percent.  Many of the farm leases of farmers have expired or lapsed. There are fears that if the traditional methods of survival of the farmers are tampered with, Sri Lanka would need to depend on rice imports into the foreseeable future. The farm costs have gone up including labour and hire of farm equipment. It has also made the farmer a permanent debtor. The Peoples Bank that was set up to assist farmers has now distanced itself from the farm sector, while the government has shied away from assisting the farmer. Today it is estimated that 22.2 percent of Sri Lanka’s food needs are covered by imports. To address this Sri Lanka has imported rice from Myanmar without any checks on its standards and suitability (for Sri Lankan cuisine). Within the Sri Lankan rice production industry there has been a shift in power structures with very few people controlling farming and especially trading. This has had a serious impact on the consumer according to the National Audit Office. They attribute this to the dire straits of the rice farming sector in the country. They have also pointed out that the ownership of rice mills in Sri Lanka has been slashed from 2000 people two decades ago to 800 today. 'Economynext' news noted recently that the government has given the nod to the State Trading Corporation to import limited quantities of rice from Myanmar to help stabilize the price of rice in the local market, which has been pushed up by a milling oligarchy, after Sri Lanka banned rice imports earlier and imposed an import tax. [IDN-InDepthNews – 31 March 2022] * Deshan Maduranga is a media and communication student at the Sri Palee campus of the University of Colombo in Sri Lanka. Image: Myanmar inks G-to-G agreement to export rice to Sri Lanka. Credit: MMR IDN is the flagship agency of the Non-profit International Press Syndicate.    

COLOMBO, March 26 (Xinhua) -- China decides to provide 2,000 tons of rice as emergency food aid to Sri Lanka, said the Chinese embassy here in a press release on Friday. The donation, which was valued at about 2.5 million U.S. dollars (including freight cost), was made at the request of the Sri Lankan government upon its current difficulty of food shortage in the island country, according to the embassy. As the continuously raging COVID-19 pandemic and the dramatically changing international situation have further worsened the global food shortage and shipping capacity, the technical teams from both countries will work closely to finalize the production and shipment arrangements, and deliver the aid to Sri Lanka at an early date, said the embassy. Noting that this year marks the 65th anniversary of diplomatic relations between China and Sri Lanka and the 70th anniversary of the signing of the Rubber-Rice Pact, the Chinese embassy said the two countries have traditionally helped each other and shared weal and woe. China will continue to support Sri Lanka's social and economic development within its capacity, the Chinese embassy added.

By R.M. Samanmalee Swarnalatha Sri Lankan government’s badly planned organic farming policy that has banned the use of chemical fertilizer in farms has upset farmers in this rice-growing heartland and a political stronghold of the ruling coalition. The policy has also drawn criticism from agricultural experts, who warn that Sri Lanka’s food security is at stake. Chairman of Minneriya Integrated Farmer Organization, Anil Gunawardhna argues that the government organic fertilizer program is an utter failure because it was announced without any proper program and work plan to achieve its aims. “The government’s original plan was to achieve this organic cultivation in ten years time.  However, without any discussion with farmers they banned the import of chemical fertilizer,” he complains. Writing in The Sunday Times in May last year just after the government banned chemical fertilizer imports, agricultural scientist Saman Dharmakeethi criticized the decision predicting that it would cause loss of forests and a food crisis.  In his election campaign in 2019 under the theme of ‘ Vistas of Prosperity and Splendour’  President Gotabaya Rajapakse, clearly mentioned that “building up a community of citizens who are healthy and productive, we need to develop the habit of consuming food with no contamination with harmful chemicals”. In order to guarantee the peoples’ right to such safe food, the entire Sri Lankan agriculture will be promoted to use organic fertilizers within ten years, the election policy platform said. When President Rajapakse banned the importation of chemical fertilizers and pesticides in April 2021, he cited health concerns. The ban on its importation was imposed through an Extraordinary Gazette Notification on May 6^th last year, following the Cabinet endorsement of the plan under the theme of  “Creating a Green Socio-economy with Sustainable Solutions for Climate Change”.  The document admitted that the use of chemical fertilizers has led to better harvests but has also contaminated lakes, canals and groundwater. For more than two decades a mysterious kidney disease has been spreading among farmers in the mainly rice-growing areas, which has baffled both hydrologists and medical experts. It is suspected that the overuse of chemicals in farming may be the cause.

Weaning Away From “Green Revolution” Technology

With many vested interests at work, the government is learning a bitter lesson that it is not easy to wean away farmers from the use of chemicals in farming. It needs careful planning and closer consultations with farmers. The agricultural production system in Sri Lanka consists of two traditional and well-defined components. One is the plantation section, established during the colonial period, consisting of large units, and producing perennial crops such as coffee, tea, rubber, and coconut mainly for export. The other is the smallholder sector comprised of small farms, which produce most of the country’s rice, vegetables, legumes, tubers, spices, and fruits. While, fertilizers and pesticides have long been used for the production of plantation crops in Sri Lanka, until several decades ago, most of the smallholder operations were farmed with little or no input of agricultural chemicals. Wide use of chemical fertilizer was introduced to the country during the so-called ‘green revolution’ in the decades 1960-70 along with “high-yielding” seeds.

Costly Fertilizer Imports and Subsidy

In 2020, Sri Lanka imported (both state and private sector) foreign fertilizers worth  $259 million, representing 1.6 percent of the country’s total imports by value according to Central Bank statistics. Sources indicate that the 2021 import bill could potentially total in the range of $300-$400 million given current international prices. By limiting and/or banning costly foreign exchange draining fertilizer and agrochemical imports, the Sri Lankan government aims to generate significant import cost savings. But, Professor Buddhi Marambe, a former Dean of Agriculture Faculty at the University of Peradeniya in recent newspaper articles has warned that an overnight shift to organic fertilizer could lead to crop declines that in turn cause huge food shortages within months. “We have spoken based on science. Without going for evidence-based decisions, nothing will go right,” he argues, refuting claims by the government that they are being manipulated. “Food security is national security,” he stresses, adding, “we must have sustainable policies to ensure food security because there is no point relying on food imports from outside”. 

Rice Farmers’ Grievances

Some rural farmers have already decided not to cultivate Sri Lanka’s staple rice in the ongoing ‘Maha’ or next ‘Yala’ cultivation seasons, because of the government’s failure to supply necessary fertilizers. Farmers here are deeply unhappy at the sudden banning of the import of chemical fertilizer. They mainly cultivate paddy, low country vegetables, cereals, grains, and onions. However, in this ‘Maha’ season, they could not use chemical fertilizer, If the government promised to supply the required organic fertilizer, farmers say they didn’t receive it at the correct time. Rice farmers have thus used different fertilizer that is normally used for tea, cinnamon, and coconut. They say this season’s rice harvest is very disappointing with resulting low incomes. Piyarathna, Chairman, Eksath Sulu Farmer Organization, representing farmers from Dehiyannewela, Divilunkadawala ,Viharagama, Medirigiriya areas told IDN that there are 142 farmers in their farmer organization and they cultivate more than 190 acres using minor irrigation  water. “Our farmers normally harvest 100- 120 bushel (2500-3000 kg) per acre using chemical fertilizer. However, this time farmers can’t expect such harvest due to improper fertilizer usage” he says, adding, “farming is now a business enterprise, (and) farmers cultivate not only for (their)consumption”. Paddy plants take around 3–6 months to grow from seeds to mature plants, depending on the variety and environmental conditions. They undergo three general growth phases: vegetative, reproductive, and ripening. “Our farmers cultivate two groups: the short-duration varieties which mature in 105–120 days and the long-duration varieties which mature in 150 days”, he explained.  “They (farmers) use hybrid seed and not traditional varieties. These hybrids varieties need quality fertilizer to increase the harvest. By using organic fertilizer farmers can’t expect high yield”.  Piyarathna says that farmers in the Polonnaruwa area have complained that the compost they have received is of inferior quality with most of the purchased compost having debris, seeds and stones. Kapila Ariyawasnsa, a 38 year old farmer from the Ekamuthu Bedum Ela Farmer Organization in Mahaweli river irrigation System B told IDN that he cultivate 8 acres of low land  both in Yala and Maha seasons – mainly paddy – and there are also 206 rice farmers belonging to his organization. He thinks that the proposed organic fertilizer program is not practical in their area. “There are not enough resources to make compost in our village. Greenery vegetables can be cultivated using compost, not paddy,” he argues, because  “there is no traditional varieties and only have all hybrid seeds (and) these hybrid seeds need required fertilizer for bumper harvest”. Further, he said that he had to spend Rs 23000 (USD 115) to purchase Yuria in black market. Ariyawasnsa, predicts that the rural economy will collapse after the coming rice harvest. “Farmers won’t have the yield this time, they would get only 30 per cent of the harvest” he predicts.  “Most of the people in Mahaweli area depend on agriculture”. He added that not only Mahaweli B zone, but most farmers in the Polonnaruwa District, would face bad harvests due to the government’s organic fertilizer program. “The current government’s policy (has been based on) unplanned policy decisions” he laments.

Farmer’s Expectation

There is also growing interest among farmers for producing organically-grown food products and they understand the export potential for it. Some farm production units have already experienced considerable success in such ventures. Organic food production and marketing could be greatly expanded in Sri Lanka. But, research is needed to develop organic farming systems and practices that are efficient, productive, and profitable. This is the criticism the government is facing at the moment. M.G. Dayawathi Chairman of Kalukele People’s company said that banning of chemical fertilizer has affected their company’s microfinance system too. “We have given more than 52 lakhs (5.2 million) of cultivation loans to 75 farmers for this Maha season. Unfortunately, farmers would not make the expected income and they are not in position to repay loans” she told IDN “Moreover, farmers mortgage their gold and their vehicles to purchase chemical fertilizer in the black market. They are trapped in a loan cycle.  Government cannot expect livelihood improvement (among farmers) with this kind of unplanned program”. 

ECONOMYNEXT – Sri Lanka’s cabinet of minister has approved the import of 300,000 metric tonnes of rice to increase the supply, a government statement said, with crop losses expected due to the use of organic fertilizer. The Minister of Trade had been given approval to import 200,000 metric tonnes of Nadu type rice (parboiled) and 100,000 tonnes of GR11 short grain rice. GR11 is a substitute for Samba, the statement said. The cabinet had earlier approved the import of 100,000 metric tonnes of rice. These rice will be imported from India, cabinet spokesman Minister Ramesh Pathirana said. Rice prices have moved up and imports are to stabilize prices, he said. Stat-run Sathosa and some private traders have been allowed to import rice, Minister Pathirana said. At least 30,000 metric tonnes had been imported from Myanmar. Sri Lanka has restricted the import of rice which has allowed millers to drive up prices. However in the Maha season, where harvesting begins from around February, crop losses are expected due to a ban on chemical fertilizer and agro-chemical import. (Colombo/Jan11/2021)

 ECONOMYNEXT - Sri Lanka expects to harvest 988,000 metric tonnes of paddy (rough rice) during the ongoing drought stricken Yala minor cultivation season, down 35 percent from a year earlier, the lowest in a decade, data from the state agriculture agency showed.

Thu, Jul 6, 2017, 09:47 pm SL Time, ColomboPage News Desk, Sri Lanka. July 06, Colombo: Following a first round of assessment, Sri Lanka has decided to take a closer look at four international rice suppliers to meet its urgent market needs, Minister of Industry and Commerce Rishad Bathiudeen said today. On the directions of President Maithripala Sirisena, Sri Lanka plans to purchase 100,000 metric tons of rice to meet its needs and has decided to test rice samples of Indonesia, Myanmar and Pakistan. Minister Bathiudeen during a discussion held on Thursday with his officials on the progress of rice procurement from abroad, said a team of technical officials including officials and food technologists from Sri Lanka are to visit these countries and test rice samples after which the government will decide on the final supplier from Colombo. Sri Lanka is looking to buy 100,000 MT par-boiled (Nadu) and Samba from the chosen supplier. "This will be Government to Government procurement - a speedy way to get rice for our domestic market," the Minister said. "If necessary we are open for private sectors support in the supplier countries as well," he added. He disclosed that Sri Lanka is also talking for another 100,000 MT rice, from India, the details of which have to be finalized. The Cooperative Wholesale Establishment (CWE) under the minister will be the focal point for the effort Minister Bathiudeen last month held discussions with the envoys of Indonesia, Thailand and Pakistan on finding a supplier of rice to Sri Lanka.  

Posted on June 23, 2017 | In Pictures

ECONOMYNEXT - Sri Lanka's rice millers have refused to sell rice at rates dictated by the state price control authority and are asking for higher prices. Sri Lanka's Consumer Affairs Authority, the agency that slaps price controls on anything from hoppers to a cup of tea, issued controlled prices of Rs80 for a kilogram of Samba rice, Rs72 for Nadu (a parboiled rice) and Rs70 for Kekulu (raw rice), exposing the flaws of Sri Lanka's economic policies to the world. Sri Lanka's rice prices surged after the drought due to import taxes blocking foreign rice from entering the country. The millers wanted a price of Rs90 for a kilo of Samba, Rs87 for Nadu and Rs80 for Red Raw. Sri Lanka's Daily Mirror newspaper said the call for higher prices was issued following a meeting in Polonnaruwa with about 120 rice processors. They came from Polonnaruwa, Anuradhapura, Marandagahamula, Kekirawa, Kantale, Nikaweratiya, Anamaduwa and Tissamaharama. Rice millers wanted a meeting with President Sirisena. Unlike small shopkeepers who are dragged to court by the Consumer Affairs Authority, large millers have political clout. Among the largest rice millers is Dudley Sirisena, brother of President Maithripala Sirisena. Most millers who bought rice last year had acquired them at lower prices. Millers have also been given credit from state banks in the past to buy rice. But millers also have to maintain warehouses to store rice for long periods. At state warehouses, rice deteriorate quickly and is sold as animal feed. Somewhat higher rice prices now could potentially allow millers to buy rice at the upcoming Maha season paddy (rough rice) at higher prices, giving higher incomes to farmers, many of whom grew lower volumes of rice. However, many farmers had crops destroyed or did not grow rice this season at all. Meanwhile, in an unusual move, which is not expected of the current administration that has acquired a reputation for policy blunders including price controls, the finance ministry cut the import tax on rice to Rs5 a kilo from Rs15, allowing foreign rice to come in. Finance Minister Ravi Karunanayake said anyone could import rice and government agencies would stay out of the market. Analysts say a regular flow of foreign rice can stabilise prices regardless of whether local millers sell or not. (Colombo/Feb13/2017)

Five companies have won contracts for the export of 50,000 tonnes of rice to Sri Lanka by June, according to the Myanmar Rice Federation. Commerce minister Dr Than Myint held talks with a delegation led by the Sri Lanka ambassador to Myanmar, KWND Karunaratne, at his office in Nay Pyi Taw on January 23 and signed a memorandum of understanding on rice exports. An MRF official said: “We invited companies to submit bids for rice exports to Sri Lanka. Only 10 companies applied. Of them, we have selected five companies.” Sri Lanka’s rice production has declined by about 200,000 tonnes after a drought last year. Sri Lanka is reducing rising rice prices and the control of rice millers by reducing import tariffs. Since April, Myanmar has exported 1.15 million tonnes of rice and broken rice, down nearly 150,000 tonnes from the same period last year, according to the Ministry of Commerce. With more countries offering to buy rice from Myanmar, exports are expected to reach last year’s level, said Khin Maung Lwin, assistant permanent secretary of the ministry. In 2015-16, the country exported 1.5 million tonnes of rice. Myanmar has exported rice to Sri Lanka in the past, but only in small quantities and without any agreement at the government level.