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The Rice Issue: From Nadu to Kekulu Shortages..!

-By Sunil Kannangara, Former Government Agent of Colombo, Ratnapura, and Ampara

(Lanka-e-News -17.Jan.2025, 10.30 PM) The rice shortage, which began with a scarcity of Nadu rice, has now escalated into a Kekulu rice shortage. While the introduction of imported Indian rice temporarily eased the Nadu shortage, the Kekulu rice shortage has become a pressing issue nationwide. The most acute shortage is of red Kekulu rice, a staple for a significant section of the population. Additionally, red Kekulu rice was essential for the Kiribath (milk rice) prepared for Thai Pongal celebrations. On January 1st, finding white or red Kekulu rice to prepare Kiribath was a challenge in many areas. This marks the first time Kekulu rice scarcity has become a widespread and common concern across the country. Identifying the reasons behind this crisis is vital for ensuring the future well-being of this nation, where rice is a staple food.

Seasonal Price Hikes and Current Challenges..

Historically, rice prices in the local market have risen during a two-month period from late November to the end of January. This is largely due to a smaller extent of paddy cultivation during the Yala season (July-August harvest) compared to the Maha season. The Yala harvest is insufficient to meet the country's six-month rice demand. Additionally, during December, as rice prices rise, farmers tend to withhold a portion of their Yala harvest to sell later at higher prices. Large-scale traders also stockpile paddy during this period, delaying the sale of processed rice until November when prices peak. As a result, rice prices remain elevated until the Maha harvest enters the market.

This year, however, the situation has been exacerbated by not only price hikes but also an actual shortage of rice. Initially, the shortage impacted Nadu rice. Nadu rice, made from long-grain white or red paddy that undergoes partial steaming, is primarily produced by large-scale mills. The government's controlled price policy made it unprofitable for these mills to supply Nadu rice due to the higher prices they paid farmers for paddy. To address the Nadu shortage, the government imported Indian rice, raised the controlled price to Rs. 230 per kilogram, and monitored the production at large-scale mills daily.

The Shift to Kekulu Rice..

In response to the Nadu shortage, large-scale mills directed much of their paddy stocks toward Nadu production. This reduced the production of Kekulu rice, which is typically manufactured by small and medium-scale mills. Kekulu rice, made from paddy without steaming, became the substitute for Nadu rice in the market, leading to an increase in Kekulu production. However, the controlled price policy also discouraged small and medium-scale millers from purchasing additional paddy stocks. Once their existing stocks were depleted, these millers ceased production, leading to the current Kekulu rice shortage. The scarcity has created opportunities for black market trading, especially for red Kekulu rice, which has reached prices as high as Rs. 300 per kilogram.

The Red Kekulu Shortage..

The red Kekulu rice shortage is particularly severe due to the relatively low production of red paddy. Red rice is primarily consumed in the Southern Province, where it is also predominantly cultivated. In contrast, major rice-producing districts like Ampara, Polonnaruwa, Anuradhapura, and Kurunegala mainly grow white and Samba varieties. The lower demand for red rice in the past discouraged farmers from cultivating it extensively, leading to its current scarcity. Consequently, the black market trade for red Kekulu rice has intensified.

The Root Cause: Unrealistic Price Controls..

The current rice shortage and black-market activity stem from the government's impractical controlled price policy. Instead of analyzing seasonal price fluctuations and finding a balanced solution that protects farmers, millers, and consumers, the government attempted to control the market, inadvertently creating chaos. This has provided an opportunity for policymakers to learn a valuable lesson about the risks of excessive market intervention. Unfortunately, the brunt of the crisis is being borne by ordinary citizens.

The Way Forward..

Currently, reports indicate that some areas in Ampara District, including Akkaraipattu, have commenced harvesting. Red paddy is reportedly fetching high prices. However, heavy rains have hindered harvesting and raised concerns about crop spoilage. If imported rice and controlled prices drive down paddy prices in the coming weeks, farmers may react strongly, leaving policymakers to face the consequences of their actions.

The government has announced plans to purchase paddy through the Paddy Marketing Board and maintain buffer stocks to stabilize the market. However, such initiatives remain largely theoretical. Ultimately, we can only hope that these measures will alleviate the crisis and that the public will soon emerge from this cycle of rice shortages.