ECONOMYNEXT – Sri Lanka is projecting a rice surplus in 2023 with the current Yala season expected to produce 1.74 million metric tonnes of paddy (rough rice), up from 1.46 million metric tonnes last year.
Sri Lanka has already had a successful main (Maha season) with 2.63 million metric tonnes of paddy, which will work out to about 1.65 million metric tonnes of milled rice after deducing seed paddy and wastage.
The Yala minor season is expected to produce 1.06 million metric tonnes of milled rice after deducing 0.08 million for seed paddy and 0.10 for wastage, Sri Lanka’s Department of Agriculture said in forecast.
The total production from the two seasons for 2023 was estimated 2.7 million metric tonnes.
Imports were 0.02 million metric tonnes.
Monthly rice consumption was estimated at 112.3 kilograms per year per person, working out to 211,930 metric tonnes per month or 2.54 million metric tonnes a year.
The rice surplus for 2023, would be 160,840 metric tonnes or about 3 weeks.
Unlike other crops where a surplus leads to a fall of the price to global levels triggering exports, rice is under import protection, with a politically powerful farmer and collector lobby.
Agriculture protection is continued in Sri Lanka, including maize which affects the price of protein, despite stunting and malnutrition of children.
Sri Lanka’s agriculture is recovering from a fertilizer and agro chemical ban by ex-president Gotabaya Rajapaksa based on claims made by macro-economists and doctors.
The Government Medical Officers Association said ancient Sri Lankans lived for 142 years before agro chemicals based on the writings of Roman author Pliny the Elder and life expectancy had now halved.
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Government macro economists also printed money and cut taxes and target an output gap, after the International Monetary Fund taught the country to calculate a ‘potential output’, triggering forex shortages.
In April 2021 government said Sri Lanka had spent 221 million dollars on importing agro-chemicals in 2019 and it could rise to 300 to 400 million dollars without a ban.
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Output gap targeting, which was included in a new International Monetary Fund backed monetary law is based on a belief propagated by so-called Western Cambridge-Saltwater economic ideology that a country’s growth can be promoted by money printing rather than hard work (Keynesian stimulus). (Colombo/July27/2023)