With the peak harvest season underway, supply of rice and paddy prices are showing a decline.

Barring the initial harvest stage, when farmers could get a somewhat attractive price for an early lower Sindh crop, rates in upper Sindh’s paddy market varied between Rs750-850/40kg by the third week of October.

This year paddy was grown on 745,000ha in the province — against the target of 750,000ha this year and 719,000ha last year.

Harvesting of the crop is in full swing in paddy growing upper Sindh, where it is the only crop of the kharif season. By and large, apart from old varieties of basmati-9, ‘subdasi’, Shahkar, Shandar, KSK282, irri-6 etc, China’s hybrid seed is used for getting better yields.

Paddy grower, Gada Hussain Mahesar says hybrid seed has been preferred for domestic consumption by many growers ever-since it was introduced. Mahesar points out that the hybrid variety lacks aroma and taste and that’s why it is not exported to the Gulf region. The seed can also not be stored by farmers for the next season’s sowing.

Dr Syed Nadeem Qamar maintains that the provincial government doesn’t control exports nor does it fix the price for the paddy crop. Gone are the days when the federal government used to intervene

by lifting the crop

Whereas, he says, irri-6 tastes better, has a long grain size and can be stored. It was most sought after in Dubai and Saudi Arabia for these reasons, he added.

Farmers say that upper Sindh’s landowners, Ameer Bux Pahore and Ishaq Mughairi, estimate that for producers to earn and save something the price should be Rs1,200/40kg for super basmati and Rs1,000/40kg for irri-6. They say the cost of production for coarse variety is Rs29,000 per acre with an average of 50-55 maunds per acre yields.

While the hybrid seed gives more yield, it’s seed is costly (Rs1,000/1kg) when compared to Rs1,200/40kg of indigenous varieties.

While Mughairi blames cartels for making millers’ matters worse, a rice miller, from Mughairi’s home district, Qamaruddin Sheikh says millers are incurring losses too. “I sold a100kg bag for Rs3,700 to an exporter from Karachi on Oct 30”, he says, while anticipating that the rate would drop even further in next few days.

With the peak season’s supply from upper Sindh, super basmati still managed to get a rate of Rs1,500/40kg and the aromatic variety — grown in Kirthar range — Rs1,100/40kg, till mid October.

Farmers say the miller-exporter nexus ultimately hits the growers’ income. Rice millers buy 41kg of crop for a price set for 40kg. Millers also make growers pay offloading charges at Rs10/bag; and with no mechanism defined to determine moisture in the crop, growers have to accept the millers’ price.

In a meeting held in Karachi on Oct 17, which was chaired by the provincial agriculture minister with rice millers attending, it was decided that no deduction would be made on any crop that undergoes mechanised thrashing. Moisture has been allowed in acceptable limits and unloading charges are paid jointly by farmers and millers — Rs5 each. However, this is not being followed.

Sindh Chamber of Agriculture (SCA) president Dr Syed Nadeem Qamar maintains that the provincial government doesn’t control exports nor does it fix the price for the paddy crop. Gone are the days when the federal government used to intervene by lifting paddy through the Trading Corporation of Pakistan and Pakistan Agriculture Storages and Supplies Corporation, he says.

Paddy has almost been completely harvested in the lower Sindh region.

Price for the crop that is stocked by rice millers usually increases in the winter season when exporters place new orders. The rates go up to Rs1,100/40kg. Until July this year paddy was bought at Rs1,250/40kg, while the February rate was Rs950.

SCAs’ Bux Sathio claims he sold his paddy in lower Sindh for Rs1,060 in early September.

Published in Dawn, Business & Finance weekly, November 7th, 2016