Rising price of rice gives food for thought – a budding rice mafia?

Rising price of rice gives food for thought – a budding rice mafia?

Written by Bella Dalima

26 Jun, 2014 | 10:08 pm

Sathosa says that it had imported over 1600 metric tonnes of rice to the country over the past few days.

Deputy General Manager of Sathosa, Anjana Prabath Nissanka speaking to News 1st said that Ponni Samba and Nadu rice were imported from India.

The Minister of Co-Operatives and Internal Trade , Johnston Fernando recently instructed Sathosa to import rice following complaints made by the general public citing that private rice mill owners are concealing rice stocks in-order to increase prices.

According to the 2013 Annual Report of the Ministry of Co-Operatives and Internal Trade, rice production in Sri Lanka had increased in 2013 compared to the previous year. Domestic rice production in 2012 stood at 3.846 million Metric Tonnes and had increased to 4.62 million Metric Tonnes by last year.

According to the Central Bank report , the Paddy Marketing Board had purchased 126,262 metric tonnes of rice produced in 2012.

In 2013, the Paddy Marketing Board purchased 233,366 metric tonnes of paddy.

However, the Ministry of Agriculture says that rice production in the year 2014 had dropped by 5 percent as a result of the inclement weather experienced during the Maha Season. Farming during the Yala season was restricted to 70 percent of farmlands due to the shortage of water .

Thereby, it is expected that the output during the Yala Season would also drop.

Although the government introduced a certified price of Rs. 35  during the recent Maha Season, rice was purchased by the private sector from the farmers for a more competitive price.

In this back-drop, the stocks of rice held by the Paddy Marketing Board decreased in comparison to previous years.

The Paddy Marketing Board also needed to provide a certain percentage of the rice produced in the country for the World Food Program, in addition to meeting the domestic demand.

It is in this back-drop, that the Ministry of Cooperatives and Internal Trade announced that it has received complaints that private businessmen are attempting to increase prices by concealing stocks of rice.

Thereby , the Ministry decided to import 100,000 metric tonnes of rice via Sathosa and distribute them under a government controlled price.

Deputy General Manager of Sathosa, Anjana Prabath said that 130,000 metric tonnes of rice were imported to the country on Tuesday

There by according to the the government controlled price, the maximum retail price of a kilogramme of Samba will be Rs.77  while for a kilogramme of White Nadu, will be sold for Rs.68.

Meanwhile, mill owners, both small and medium scale, say that they do not have sufficient stocks of paddy to produce rice.

Chairman of All Ceylon Peasant’s Organisation, Namal Karunaratne shared the following views:


There is no scarcity of rice. This situation has been created artificially. A handful of persons control the rice market in the country. During the recent harvesting season, the medium scale mill owner was also compelled to purchase rice for a much higher price. In such an environment, the government had introduced a certified price, before the amendment was made it stood at 60 rupees. In this backdrop, the government conducted raids in relation to the government controlled price and thereby left medium scale mill owners were left helpless.

The large scale mill owners took steps to purchase the remaining stocks of the medium scale mill owners. The government needs to convert the stocks of paddy to rice and release them to the market. However, instead of this taking place they are releasing stocks of paddy to private businessmen. This too is being purchased by these large scale mill owners. They collect the stocks separately. They purchase the governments stocks of paddy and the stocks from the medium scale mill owners as well. They are having massive stocks of paddy in their storage facilities and are concealing them to indicate there is a shortage of rice. Their objective is to raise the prices .[/quote]


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