Government overhauls PMB to stabilise rice market to support farmers
Sri Lanka is set to restructure the Paddy Marketing Board (PMB) to extend more support to farmers and stabilise rice prices in the face of prevailing market challenges.
The board, hitherto relatively dormant, owing state banks Rs. 28 billion, will now be involved in direct purchase of paddy from farmers at guaranteed prices, removing the inefficiencies and manipulative aspects in the market.
President Anura Kumara Dissanayake has instructed officials to strengthen the PMB, refurbish paddy storage facilities and involve small-scale millers in rice production. The government also plans to cultivate 1.3 million hectares of land during the Yala and Maha seasons to increase annual rice production.
These measures are intended to stabilise the market by eliminating superfluous profits of large mill owners, thereby assuring remunerative prices for the farmer and affordable prices for the consumer.
The board will now focus on purchasing paddy directly from farmers at guaranteed prices, addressing inefficiencies and curbing market manipulation.
But despite all these efforts, the hiccups persist because of inefficiencies within the Food Department, cooperative societies, and even the PMB itself.
Therefore the government is to purchase 300,000–400,000 metric tonnes of paddy in the 2024-25 Maha season for processing and distributing through cooperative stores and state outlets such as Sathosa.
Agriculture Ministry Secretary M.P.N.M. Wickramasinghe blamed market manipulation as the real reason for rice shortages, rather than actual supply problems. Although there is price control, farmers are unable to sell their paddy – thus an imbalance occurs in the market.
While Sri Lanka produces 3.53 million metric tonnes rice annually, the supply becomes scarce due to unaccounted surpluses.
Annual consumption stands at 2.4 million metric tonnes with a monthly production of 200,000 metric tonnes, he added.
Medium and small-scale millers, burdened with debt and closures, said that the re-activation of PMB was vital, their association’s president P.K. Semasinghe said.
With almost 10,000 mills closed during the past 10 years, only 700 are left operational. He further said that the PMB can streamline the prices by buying paddy and selling it to small millers so rice can be sold at below Rs. 220 per kg. This will save both producers and consumers from market fluctuation.
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