Govt struggles to meet rice purchase target due to high prices

Highlights  

• Govt has so far procured about 2.21 lakh tonnes of paddy against the target of 6.5 lakh tonnes
• For rice, it has bought 5.22 lakh tonnes against the target of 11.5 lakh tonnes 
• Farmers are reluctant to sell paddy to government
• Market price is Tk100-150 higher than the government price 

The government is struggling to meet its rice purchase target, thanks to the reluctance of farmers in supplying paddy to government warehouses for a number of reasons.  

Farmers are not interested in selling paddy to the government because, in the open market, they are getting Tk100-150 more than the price offered by the government.

They say officials raise various excuses when farmers take their crops to warehouses. For example, officials say the rice is wet and farmers must dry it and come back again. It is easier to sell paddy in the local market than to face so many hassles. 

Food ministry sources said fears grew about meeting the target as the government has not been able to procure even half of the target, although the procurement drive has been going on for about two months. 

The government managed to buy only 221,598 tonnes of paddy till 12 June, against their paddy purchase target of 6.5 lakh tonnes, this year. In the case of milled rice, the government has so far procured only 5.22 lakh tonnes of rice where their purchase target for this year was 11.50 lakh tonnes. At present, the government has 10.18 lakh tonnes of rice in stock, sources added. 

According to information from The Business Standard district correspondents, coarse paddy is Tk1,080 or more per maund across the country,  and better quality paddy is going for Tk1200-Tk1220. The government is buying paddy for Tk1, 080-1,100.

Nur Islam, an agricultural card holder farmer in Mahmudkati village of Jashore, said, "I produced more than 100 maunds of paddy. I gave some paddy to the government for Tk1,100-1,150 per maund so they have some of my rice."

Citing his reason for not selling more to the government, he said, "I will not give paddy to the warehouse because in the open market I can get Tk100-150 more than the government price."

Moreover, when farmers go to the warehouses, officials refuse to take paddy, showing various excuses like 'the paddy is wet, or it isn't clean', he added.

According to the Jashore Food Controller's Office, 4,487 tonnes of paddy was procured till June 12 against the target of 21,879 tonnes.

InderjitSaha, food controller of Jashore'sMonirampurupazila, said work on buying paddy was slow. Farmers are reluctant to sell paddy to the warehouse with prices running higher in the open market.

 "We are struggling to achieve the procurement target."

SM Saiful Islam, district food controller for Dinajpur, said farmers are reluctant to sell paddy to warehouses as prices are high in the local markets. When officials buy paddy, moisture and cleanliness are also important for warehousing.

It is a bit difficult for farmers to maintain all the criteria. That is why there is a little slowdown in paddy collection, he added.

"Also, 14,500 tonnes was procured till the second week of June against a 25,000-tonne paddy purchase target," he said. 

According to the food department, the government target is to buy 6.50 lakh tonnes of paddy at Tk27 per kg, 10 lakh tonnes of boiled rice at Tk40 per kg, and 1.50 lakh tonnes of atap rice at Tk39 per kg, by August 31.

Last boro season, the government set a paddy purchase target of 6 lakh tonnes, and a rice purchase target of 11 lakh tonnes. The government failed to meet these targets for a variety of reasons, and government reserves sank to the bottom.

To cash in on such situations, traders raise bulk rice purchase prices in local markets and individual retail customers end up having to buy rice at a high price, which is why the price of rice has gone up in two phases, even when the market is flush with rice after a peak harvest season.

MdRaihanulKabir, director (Current Charge), Procurement Division, Directorate General of Food said, "Procurement drives are going on now. We have to see how much will be purchased in the end. It is difficult to say at this point whether the target will be met."

He said, "The government has an objective to buy paddy so that farmers get good prices. This objective is successful because farmers are happy to sell paddy at a higher price."

According to several district level officials of the Food Department, now farmers do not have much paddy in stock as they have sold it from the field. The government has to take most of the paddy from local wholesalers as they have bought the paddy and built up stocks.