The high-yield dilemma

Sri Lanka’s rice farmers have a problem: soon there will be too much rice

By Echelon.

Published on April 07, 2015 with No Comments

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For two millennia Sri Lanka’s self-image has been bound to one crop: rice. The rice farmer is also venerated. The scantyness of the loincloth, the sunburnt sweat-soaked dusky skin, the mud-caked limbs straining muscle and sinew at the plough, evoke strong emotions; a poignant throwback to plentiful food over the millennia. In Sri Lanka’s rice bowls around its man-made reservoirs, nothing else grows with the same productivity. Despite the challenges, Sri Lanka has managed to avoid mass famine because it’s had enough rice most of the time. Rice has a role in Sri Lankan society that is hard for an outsider to appreciate. Whenever rice farmers have problems, the whole country is in crisis. The stupas and irrigation reservoirs built measured the greatness of a king. In the two and a half millennia since King Pandukabhaya built the first artificial reservoir in hostile territory to grow rice in the dry season, the crop’s success has been linked to irrigation. Annual monsoon allowed one rain-fed crop but the irrigation systems storing excess rainwater made it possible to plant another crop during the dry months. The ability to plant a second crop was the major contribution reservoirs made to rice and Sri Lankan monarchs added new ones, expanded existing ones and built and maintained a complex water distribution system.

Sri Lanka as a hydro civilization was unsurpassed at its peak over a thousand years ago and had many large reservoirs and an incredible 25,000 minor tanks – whose irrigable area is less than 80 hectares (1-hectare = 2.5-acres), most of them in the dry zone, of which around 10,000 are functioning.

Rice farming has had its ups and downs over the millennia. Reservoirs went in to disrepair during conflicts, when monarchs neglected agriculture and when the royal capital shifted to different areas in the island. By the time the British occupied Ceylon, the reservoir and irrigation system supporting rice was in an abysmal state. Ceylon, then, was importing rice from India. The rice farming recovery started under British occupation and since independence yields have tippled. Sri Lanka now grows more rice than it can consume.

In isolation, these gains look impressive and rice growing is often analyzed with an insular view because of the romanticized notion of rice self-sufficiency being an important achievement. Sri Lanka may have been a pioneer and innovator in rice farming two millennia ago, but today it’s a laggard.

rice4rice5The average Sri Lankan eats 121 kilos of rice annually, a higher per capita rice consumption than anywhere else in the world except poverty-stricken Myanmar. Rice is also somewhat expensive in Sri Lanka. A tonne of high quality milled rice sells for around US $ 400 (five percent broken milled white rice) in the international market. A kilogram of white rice (Samba) retails at Rs120 or higher in Sri Lanka or $ 890 a tonne at retail price. A kilo of high quality Hom Mali rice (a popular fragrant Thai rice) retails in that country for about the same price as does low quality white in Sri Lanka. Because Sri Lanka imposes high rice import taxes to protect growers, consumers don’t benefit from lower international market prices. Agriculture (excluding fishing) accounts for 9.4% of the economy and rice farming and related activity accounts for a 1.6% share. Despite the relatively small contribution from rice (vegetables, highland crops and fruits account for 3.8% of economic value added) the impact of rice is significant for two reasons. Firstly there are many rice farmers; as many as 897,000 separate land plots growing rice according to a census department survey in 2002. There aren’t as many vegetable and fruit farmers although that sector of agriculture adds more than twice the economic value as do rice farmers. Any dip in rice fortunes impact many families in some of Sri Lanka’s poorest districts like Ampara, Kurunegala, Polonnaruwa and Anuradhapura where over half the crop is grown. Secondly – because of the long history of rice growing and Sri Lanka’s phenomenal record of innovation around reservoir irrigated agriculture–the crop is associated with a period in the island’s history when it was a global leader. Every fifth grader knows this history and a problem for farmers or a shortage of affordable rice quickly spirals up the national psyche. No government could contemplate a rice crisis with equanimity. Governments have learned the hard way not to mess with rice farmers or its supply.Facing a balance of payments crisis, the Sri Lanka Freedom Party (SLFP) increased the price of the two-pound rice ration to 40 cents from 25 cents. With elections looming in 1960, it then cut the price to 25 cents for the first and 45 cents for the second pound. It lost the election. The new UNP government lasted only a few weeks even after pricing both measures of rice at 25 cents. A wiser SLFP then left the ration alone. The rice ration became a major point of debate as the 1965 elections approached with both parties promising larger subsidies. In 1966, the UNP government that won the election reduced the ration to one measure. It was free. In the run up to the 1970 vote the SLFP did one better and promised ‘rice from the moon’. This proved to be difficult to get done once in power. Soon, it had to rein in spending amidst another balance of payments crisis. The ration was increased to two pounds, one measure free and the other purchased at 75 cents. By 1973, the purchased component was more than doubled to Rs2 and the free measure halved.

Sri Lanka has weathered economic falls and sidestepped famine better than most poor countries because of its long history of democracy. The other reason is the green revolution that pushed up agricultural yields in step with population growth. Rice yields per hectare climbed from 1.58 tonnes in 1952 to 4.3 tonnes per hectare by 2012. Yield gains of around 1.75% a year till about late 1990s were only enough to keep up with population growth. Population growth has dropped off since then but yields are still rising and there is ample evidence to suggest they will continue upwards. Yields rose because of improved seeds and the widespread use of fertilizer, insecticides and weedicides. These new farming practices staved off famine in Sri Lanka where the growing population was getting up to two fifths of their calories from rice. Disused reservoirs were dug up and filled with rain water and new ones – like those under the Mahaweli irrigation scheme – were built, increasing hugely the land under rice cultivation around these schemes. The area under rice cultivation has more than doubled from 471,000 hectares in 1952 to over 1.2 million hectares now. Just when the gains of the first green revolution are leveling off another is about to take its place. The dichotomy for Sri Lanka where a large segment of its poor are rice farmers is the potential income boost this could provide. But huge productivity gains ahead of structural reforms in agriculture is a frightening prospect.

rice3Because the average Sri Lankan is eating a kilogram of rice every three days, there is little potential to feed them any more. In fact as wealth increases and lifestyles change, per capita rice consumption will fall from the current record levels. Demographers forecast Sri Lanka’s population will peak at 23 million around the year 2030 up from the current 20.4 million levels. So there is little potential that a soaring population will demand more rice.Improved farming practice linked productivity gains will push yields to five to six tonnes per hectare, levels already being achieved in places like Thailand, Vietnam, Cambodia, Laos and China. That’s a 25% to 50% increase in the rice crop here. Ten tonnes a hectare have been achieved in places with intensive farming practices in Asia. Sri Lanka’s highest yields are probably seven tonnes a hectare being achieved by listed agriculture firm CIC at its rice fields in Hingurakgoda. A second green revolution scientist’s forecast will lift the rice crop in areas which were failed by the first one. Hybrid seeds are already being sown in fields across Asia engineered to withstand floods. For decades these miracle seeds have been talked about and they are now available almost everywhere,but not in Sri Lanka.

Collectively called ‘Sub 1’ more than a dozen flood resistant rice varieties developed by the International Rice Research Institute (IRRI) have been planted by over five million farmers worldwide including India. Sub 1 is the first of the new generation of IRRI seeds. Over the next few years those more tolerant to drought, salinity and extreme heat now undergoing the final phases of IRRI field trials will be available to farmers. While Sub 1 varieties are proven, agricultural laggards like Sri Lanka are probably years away from embracing them. The potential is that these varieties will lift yields in rain fed rice farms accounting for 15% of areas sown where yields are 53% lower than those achieved by paddies irrigated by major reservoirs.

rice2Drought resistant or less thirsty rice varieties will make Sri Lanka’s second planting season called Yala (between May to August) yield as much as does the main season Maha. Rice is a semi aquatic crop for which ideal growing conditions have been simulated by Sri Lanka’s irrigation system. It’s most successfully grown in Asian river deltas where year round water makes it possible to grow three crops. Here farmers grow two crops a year and do nothing during the rest of the time. Second green revolution seeds will make the most impact in fields now sidelined for their marginal productivity.

Second green revolution seeds can close the gap between Sri Lanka and Asia’s most productive fields first by making it possible to plant all rice paddies during Yala season instead of only the two thirds of land now ‘aswaddumized’. It can also boost rainfed rice yields and push the boundaries of the two-crop model and give at least a limited third crop in some areas. If Sri Lanka can introduce second green revolution seeds soon, it could potentially double yields in a decade. This is an opportunity and frightful prospect for a country that already has more rice than its people can eat – unless it can export the surplus.

The problem is no international market exists for the small grain crop grown here. Consumers prefer long grained and fragrant types grown in places like Thailand and Vietnam.Thailand exported rice worth $5.4 billion in 2014. In 2013 Sri Lanka’s largest export, apparel earned $4.26 billion while negligible rice exports from here target homesick Sri Lankans living overseas. In 2014 Sri Lanka imported at least 90,000 tonnes of processed rice, more than half of it from Bangladesh because a drought and floods damaged crops. In a good year Sri Lankan fields produce up to 4.8 million tonnes of rice. Imports in 2014 were the equivalent of around 2% of demand for small grain rice. Sri Lanka also imports long grain and fragrant rice because tourists holidaying here prefer these. Sri Lanka’s rice preeminence faded decades ago. Sri Lankan rice yields kept pace with the original green revolution, which started in the 1950s’. Thirty years later yields had doubled. During this time Sri Lanka transformed from a country stalked by malnutrition to one with greater optimism about the future. Since the 1980s yields have climbed a further 30% or so but these last gains haven’t been enough to keep pace with the world’s top rice producers whose yields are 25% to 50% higher than Sri Lanka’s and grow rice varieties that have ready global demand. Unless Sri Lanka can sell in the international market its rice crop exceeding 4.8 million tonnes, prices here will decline. Higher yields don’t mean costs will rise in step, but rice farmers are a coddled bunch. They have grown to expect rice should fetch a higher price even if it means the government purchasing some of it at higher-than-market prices. The government has guaranteed to purchase unprocessed rice at Rs50 a kilogram compared to the Rs35 or so it fetches in the market now. In the past, such schemes have absorbed around ten percent of the crop. However, what may appear to be a bounty for farmers will prove disastrous for rice farming because it offers an artificially high price for small grain rice. Farmers will grow more of the same small grain rice than make the more sensible switch to varieties in demand internationally.

riceSri Lanka was renowned as the ‘granary of the east’ during a period hundreds of years ago when it grew a surplus crop of rice. It can only regain that position by producing more of what the international market wants. Thailand, India and Vietnam currently top the rice export league tables. There are other challenges facing rice farmers like the fragmented nature of land holdings around the major irrigation tanks, meddling governments that undermine farmer incomes by artificially propping up prices and then importing rice at other times and market distorting subsidies. However these challenges will appear trivial if Sri Lanka ends up with such a large crop that it can neither consume nor export. The positive side is that this will not happen overnight. If government stops market-distorting interventions in rice farming the challenge of a large crop will quickly become apparent when it does hit the market. If yields have risen permanently the market will have to figure how it’s going to deal with the crop. Growing an export crop is a practical option.

After decades of gains since the green revolution, Sri Lankan rice now faces a challenge unlike any it has faced in the past. In its response it has an opportunity to allow Sri Lanka to re-emerge as a granary of the East.

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