Dhaka, Bangladesh
Perils of Plenty

Perils of Plenty

A bumper harvest should always be a good news. But sometimes it is fraught with bane instead of boon. The bad news is that this year's bumper boro crop has created a situation of surplus supply leading to unfairly dirt-cheap sale price of paddy at the farmers' level. The prosperity of our agriculture now seems to be bad news for our farmers. It now appears that the cornucopia of paddy is actually not a blessing from the growers' point of view. The government announced that it will procure paddy at Tk 1,040 per maund from the farmers. But many farmers were forced by the circumstances to sell paddy at Tk 500-600 per maund, which is much below the production cost, to the middlemen as the government procurement was inordinately delayed. Small farmers with limited resources borrow heavily during the planting season to buy seeds, fertilizers, irrigation water and to tide over the lean period before harvest time and often go for 'distress sale' during and immediately after the harvest, because the farmers have various obligations to meet. Nature's bounty, government policy and an alleged nexus between the influential quarters, rice-mill owners, and traders have now resulted in a crisis for the government. The reasons for the current debacle can be traced to lapses in our policy arena and lack of vision on the part of the various ministries involved in procurement, trade, and distribution of food grains. Providing price support for farmers has always been a top policy goal of almost every government. In practice, however, successive governments procured very little paddy directly from growers in the last three decades. Since 1991, the Directorate of Food bought only 15 percent of its total annual purchase of the staple in the form of paddy from growers when it procured the rest 85 percent in the form of rice from millers. As a result, millers have gained more from the government's food grain procurement policy, the prime objective of which is to provide price support to farmers. Even this year, the government is buying only 1.5 lakh tonnes of paddy from farmers. On the other hand, it plans to procure 12.5 lakh tonnes of rice from millers. Experts opine that the authorities concerned have not been successful in giving price support to farmers. But this is an extraordinary year and it calls for extraordinary measures. They suggested that the government should buy more paddy directly from growers. About 77 percent of marginal and small farmers depend on rice for food security and their livelihood. Government's rice procurement from millers will drop paddy price further. The government should buy more paddy from farmers as it will benefit them more.

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