Sri Lanka wholesale rice prices fall dramatically in February
Mar 02, 2018 08:27 AM GMT+0530 | 0 Comment(s)
ECONOMYNEXT - Sri Lanka's wholesale rice prices at the Marandagahamula market, which is a benchmark for the rest of the country has fallen dramatically in February with key grades down 20 percent from December 2017, as domestic harvests start to come in.
Marandagahamula Samba, a domestic premium rice fell to 82.30 rupees a kilogram on February 23, plunging 27.1 percent from 104.63 rupees a kilo peak reached on December 29, according to central bank data.
Marandagamula White Kekulu (Raw) rice fell from 20.3 percent from 90.75 rupees a kilo in December 29, to 75.40 rupees in February 23.
Marandagamula Red Raw fell 7.5 percent to 83.25 rupees a kilo to 77.00 rupees a kilogram.
Marandagamula Nadu, a popular grade used widely in mass-market rice takeway market (buth packet) rice fell 21.75 percent to 75.70 rupees a kilo from 96.50 rupees a kilo.
Sri Lanka main Maha (winter/spring) harvest is now coming in with this year's harvest expected to rise 57 percent as the rice growing regions recover from a drought.
The high prices last year helped cushion farmer incomes, as output halved.
Global rice prices are still high. Over 2017 rice prices have risen 20 to 30 percent in rice exporting and importing countries.
Unlike in Sri Lanka, where rice is protected with import duties, most Asian nations produce export grade rice and good harvests pushes up farmer incomes.
In 2017 many countries in Asia were hit by drought, with India's harvests estimated to be down 30 percent in some areas, pushing up prices. Indian coconut prices also rose.
The Food and Agricultural Organization's All Rice Price Index rose 18.1 percent in the year to February 2018.
The premium aromatic rice index was up 25 percent and the higher quality Indica index was up 15.7 percent.
Many countries have blamed the usual suspects, 'errant traders' and 'speculators' for rice price hikes.
"There might be some mechanisms by dishonest businessmen," Bangladesh PM Sheik Hasina was quoted as saying in parliament.
Bangladesh has cut import duties from 28 to 10 percent amid rising prices, the report said. Sri Lanka also cut import duties last year as prices rose amid a drought.
Sri Lanka's central bank also collapsed the rupee in 2015 and 2016 adding to the global rise in prices. In Sri Lanka's 'rice mafias' especially importers and millers are blamed for both hikes and falls in prices.
Sri Lanka's rice prices fall dramatically in good harvests, even when global prices are strong, as farmers who have been protected for years through import duties do not produce grades of rice that can be internationally traded.
Marandahamula benchmark wholesale prices are now at levels seen in December 2015. The government has announced floor prices for farmgate paddy (rough rice) (Colombo/Mar02/2018)