Making the most of a bumper harvest

The countrywide harvesting of the boro rice crop is fast coming to a close. Favourable weather conditions, coupled with public policy support to farmers in the form of inputs delivered in time and at affordable or lower prices, have largely led to a good harvest this year. Farmers' motivation has, thus, been kept high to put in their best efforts to produce this harvest. The targeted production of boro rice was some 18.5 million tonnes. But it is now estimated that the yield would surpass 20 million tonnes. This is, no doubt, a good piece of news for the country. Food security is basic to the country's stability; it is heartening to see the authorities recognizing this vital aspect and making a comprehensive endeavour to raise output. Adequate internal production of the main staple can be a cushion for the macro-economy from reducing import dependence, conserving the foreign currency reserve and helping its utilization for meeting needs in other productive areas and keeping pressures off the balance of payments position. Although the production of boro rice in the previous season was not far off the mark, better success was largely marred by foulplay by rice traders in the distribution channels. Therefore, the government needed to import substantial quantities to maintain its capacity to intervene in the market and keep the prices of rice stable, even at the cost of importing rice at higher prices, which on average, have soared by some 40 per cent over the last one year. Against this backdrop, it is imperative to operate policies with hindsight so that the most can be made out of this year's exceptionally bountiful boro harvest. The main strategic aim ought to be mopping up a good amount of boro rice for boosting the foodgrain stock in government silos. Traditionally, a system of internal procurement of food grains is relied on to replenish the silos. Official procurement prices are declared and farmers are urged to sell at the government-run procurement centres. It is also stated that the officially declared procurement prices provide an incentive to the farmers to sell their produce at such centres rather than to the exploitative middlemen. However, a lot still remains to be done to cleanse the government's domestic foodgrain procurement operation of various irregularities and underhand deals by a section of corrupt officials in league with all sorts of intermediaries. Last year, government's otherwise good support in helping production was reportedly offset to a great extent by alleged machinations of big rice traders and middlemen. That led to a situation of farmers delivering their produce not to the procurement centres but to the private traders. Rigid procurement prices and lack of flexibility in the related policy, caused a setback and a far less amount could be procured compared to the target. So the government was forced to opt for import to improve its stock position, spending unnecessary amounts in the volatile international markets. The private rice traders and stock maintainers allegedly also took full chance of the situation to hoard rice, and succeeded in manipulating prices to higher levels, causing much pain to consumers specially in the low-income category. This situation persisted throughout 2010 and well into the present year. Therefore, the government must in no way allow a repeat of last year's experience. It should operate procurement policies flexibly all through the procurement period to keep the farmers largely motivated to sell to the government and not to the private hoarders and profiteers. To this end, the government will also be required to expand its stocking capacities. It should therefore step up its efforts to build new storage facilities. Related works need to be completed at the soonest.