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Sri Lanka: Sri Lanka Agriculture Profile 2012

2012/04/04

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Sri Lanka Agriculture Profile 2012

Reference Date: 25-May-2011

 


FOOD SECURITY SNAPSHOT

  1. Estimates of 2011 Maha season paddy crop revised downwards due to flood damages

  2. The reduced domestic production and rising international prices lead to a sharp rise in food prices since August 2010

  3. Over 1 million people have been affected by the floods in the east and central part of the country and require humanitarian assistance

Estimates of the 2011 Maha season paddy crop revised downwards due to flood damage

Harvesting of the main season (Maha) paddy and maize crops is currently underway. Given the generally favourable rainfall and input supply situation during the growing season a bumper harvest of paddy was anticipated. However, heavy rains in December-January have caused severe flood damage in the eastern and central parts of the country. According to the Ministry of Agriculture the revised estimate of the Maha 2011 paddy production is 2.02 million tonnes, some 23 percent down from the previous year’s bumper Maha crop. Damage to other crops has been much less. For example, maize harvest of the Maha season is expected to increase by 6 percent over the previous year.

 

The final estimate of paddy production for 2010 was a historical record at 4.3 million tonnes, about 17 percent over the reduced harvest of 2009.

 

Wheat is not produced in the country. Import requirements in marketing year 2011 are estimated requirement at a normal level of some 1 million tonnes. In order to reduce dependence on imports the Government has increased import duties on wheat.

International price hikes lead to significant rise in wheat and rice prices

Given that the country is a net importer of both wheat and rice domestic prices are affected by the rising international prices. The increase of rice price has been also supported by production loss due to floods to the crop during last few months. April price of white rice in Colombo market was slightly down over the price month before.

Overall food security situation has improved

Food security situation has dramatically improved after the end of the 25-year old war between the Liberation Tigers of Tamil Eelam (LTTE) and the government forces in May 2009. Most of the IDP camps are now closed but some IDPs remain with host families. According to the Disaster Management Centre, as of 16 January 2011, the floods of past few months in the eastern and central parts of the country have affected over 1 million people. Various international appeals to mobilize humanitarian assistance are being launched.

 

08/12/2010  Record harvest of the 2010 paddy crop
Harvesting of the second season (Yala) paddy and maize crops is currently underway. The official preliminary forecast puts the harvest of paddy at a bumper level of 1.6 million tonnes, some 27 percent over the previous year. The first season (Maha) paddy, harvested in March-April, is estimated at a record level of 2.65 million tonnes, 12 percent above the last year’s reduced harvest. Much of the improvement in production is due to the increase in paddy cultivation area (highest ever) in response to higher farm gate prices, fertilizer subsidies and favourable weather conditions. With this level of production, very little if any, import of rice is expected. Since wheat is not produced in the country, the estimated requirement of some 1 million tonnes is all imported, mostly through commercial means.

Bumper harvest leads to significant decline in rice prices
Owing to the estimated bumper paddy harvests in 2010 prices of rice (the main staple food) have come down significantly during past few months. The retail price of rice had been more or less stable for last two years around LKR 60 a kilo, up from about LKR 35 during 2007 before the soaring food prices crisis. Currently the price is about LKR 48. The downward pressure on prices also reflects Government’s plans to cultivate over 40 000 hectares of fallow paddy land in the forthcoming Maha season.

Prices of wheat flour after a sharp decline in January have shot up in July following the Government’s decision to reimpose an import duty of LRK 10 per kg on wheat grain imported to reduce consumption of flour and support rice prices in anticipation of the bumper Yala harvest.

Overall food security situation has improved
Security situation has dramatically improved after the end of the 25-year old war between the Liberation Tigers of Tamil Eelam (LTTE) and the government forces in May 2009. Reduced rice prices also will help improve food security in the country.