Financial Times

CIC mulls 'wild rice' exports
CIC Fertilizers plans to acquire a modern Japanese rice mill as part of a new drive to cultivate and export some of the 200 varieties of wild rice indigenous to the island that are no longer commercially cultivated by paddy farmers. The company's aim is to exploit the characteristics such as high nutrition and more aroma and flavour found in the 'wild' or traditional varieties of rice and seek niche overseas markets for surplus rice now that the country has achieved self-sufficiency in the commodity, its chairman B.R.L. Fernando said.

"We are a small country with a small land mass. We can never be an export surplus country like Vietnam or Thailand so we must focus on specialised, high value niche markets," he said in an interview. Sri Lanka has one of the largest varieties of rice among rice producing countries. Already some red rice from the south is exported to niche markets.

"We have a base from which to operate," Fernando said. "Our aim is to identify the indigenous rice varieties that can be exported, and will give us the required yield and the price level we want." The programme is somewhat similar to the effort by the Ceylon tea industry to identify and promote different types of tea grown in different elevations and ago-climatic regions.

Good rains in the last Maha season and this Yala and the resumption of cultivation in the north and east have resulted in surplus rice production, raising fears among farmers they might not be able to sell their produce. "This will become a major problem since we will not be able to sell seed paddy and farmers' incomes will drop," Fernando said.

Furthermore, the type of rice produced in Sri Lanka, such as the samba and nadu short-grain varieties, are geared to suit the Sri Lankan palate and are not exportable.
The Japanese, with their chopstick culture, prefer sticky rice varieties while the most exportable, Basmathi, is a long-grain rice.

Another problem was the lack of good rice mills. Sri Lanka can't cater to niche markets that are available because the rice is not milled well, with uniformity in size, look and colour. "We're trying to bring about a change in what we're growing and where we're growing," Fernando said.

CIC aims to commercialise cultivation of traditional rice, which have been preserved by the Agriculture Department, although farmers are no longer growing these types.
The company plans to send samples of traditional rice varieties through rice traders and test overseas markets, especially in areas where consumers are getting more health conscious.

"Then we'll put it into our seed programme so farmers will cultivate those varieties that are exportable," Fernando said. "This programme necessitates that we get a good quality mill capable of producing export quality rice."

CIC Fertilizers, a subsidiary of Chemical Industries (Colombo) Ltd, is to buy the mill from a Japanese firm called Satake - which makes and installs mills - and set it up in the northeast region. It will cost about Rs. 50 million, including installation by March 2004 and a fully-fledged laboratory to test the quality of rice.

It will have a capacity of 2.5 tonnes an hour and will be used largely as a demonstration model to educate farmers. "It's not going to be easy," Fernando said. "It is not a short term project - we're in it for the long haul."

CIC Fertilizers is also exploring the possibility of buying a government-owned mill at Hingurakgoda and modernising it as part of its long-term strategy in the rice market.
The parent firm, Chemical Industries (Colombo), is a company involved in the import and distribution of paints and fertilisers, and in pesticides, seed, planting material and animal feed.

CIC Fertilizers distributes fertilizer and focuses on the generation of seed paddy. The firm operates the former government seed farms in Hingurakgoda, Pelwehera and Talawa.

"We've done well," Fernando said. "We moved up the yield from 55 bushels an acre to 125 bushels at Hingurakgoda. We're now supplying a fair quantity of seed paddy to the market. We want to raise the yield to 175 bushels."

An example of the success of the company's technology transfer programme to farmers was the 200 bushels an acre achieved by farmers in Ampara. "So there's no reason why we can't get 175 bushels," Fernando said. "We need to resuscitate the soil - we collect cow dung, husks, and grow glyricidia on our farms to put more green matter into soil as this will increase yield.

"Our focus is on soil and water management while streamlining the fertilizer regime," he added. "Till now we put one particular mix into all the soils. We're now looking at specialised blends for different soils." CIC also intends to ask the government for tax incentives and to be allowed to consider tax deductible money invested in projects.

Farmer groups let down members
From Quintus Perera in Polonnaruwa
Rice farmers across the Mahaweli B division in Polonnaruwa and other northeast areas while grappling with low prices and surplus production, are encountering a fresh problem - corrupt leaders of farmer associations.

A cross section of farmers told The Sunday Times FT last week that these so-called farmer leaders while earlier organising protests and demonstrations to spotlight issues are now betraying the cause of the farming community.

More and more leaders of farmer associations are succumbing to the pressures of the authorities and accepting some 'santhosam' to keep quiet particularly now when farmers are seeking relief from the government through better prices for their rice. A surplus rice harvest this year has prompted parliamentary authorities to serve three rice meals a day in the legislature. In a separate campaign, the government is urging Sri Lankans to consume more rice.

Farmers, disgruntled by the lack of leadership in their community, are distancing themselves from the plethora of associations that fight on their behalf.

Though the government is sharpening its propaganda machinery on rice, the bureaucracy is going at the same old snail's pace.

Unscrupulous private traders are busy collecting the farmers' harvest at Rs. 10/50 to Rs. 10/75 per kilo, which barely covers production costs and is Rs. 2 lower than the government guaranteed price.

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