Paddy bonus casts shadow over rice export in Chhattisgarh

The bonus on paddy announced by the Chhattisgarh government had cast a shadow over the export prospects of rice in the state.

The state government had announced a bonus of Rs 300 per quintal on paddy which would be procuring at minimum support price (MSP) from the farmers. While the move had cheered the farmers who would be getting a higher return, the rice traders in the state had been in distress.
 

The Centre has approved Rs 80 per quintal hike in paddy MSP at Rs 1,550 for common grade variety and Rs 1,590 for ‘A’ grade variety. The farmers in Chhattisgarh would hence get Rs 1,850 per quintal for common grade and Rs 1,890 for “A” grade variety of paddy that they would sell to the government through the societies.

A major portion of the state is reeling under severe drought. Subsequently, the production was likely to be affected. The government estimates that it would bear a 30 per cent loss in paddy production. For the kharif marketing season 2017-18, Chhattisgarh had set a target to procure 6.9 million tonnes of paddy at MSP.

“Following less production, a major portion of the produce would be consumed by the government at MSP while the farmers would be reluctant to sell the leftover stock to traders at a lower price,” Yogesh Agrawal, president of Chhattisgarh rice millers’ association, said. The traders would either have to purchase paddy at the higher price or would be deprived of stock, he added.

According to Agrawal, the traders in Chhattisgarh quoted the high price to their counterparts abroad as they were left with no other option. Following a competition, traders abroad would prefer to purchase from Odisha, Maharashtra or Andhra Pradesh.

Besides, the state government had announced that it would not release water for Rabi crops due to drought, which would affect around a million tonnes of paddy. The entire stock of summer rice (Rabi rice) produced in the state is exported.

Chhattisgarh had been exporting about 1.5 million tonnes of parboiled rice. The produce is shipped mainly to African countries besides neighbouring Bangladesh.