Kerala has finalised a deal with Andhra Pradesh for sourcing parboiled rice and five other essential food items at affordable rates.  As part of this, the Andhra Pradesh Civil Supplies Corporation will procure 3,840 tonnes of premium quality “Jaya” rice directly from farmers at the minimum support price (MSP) every month and transport it by train to Thiruvananthapuram, Kollam, Ernakulam, Thrissur, and Kannur.

This was decided at a meeting earlier this week between the Andhra Pradesh Food Minister KP Nageswara Rao, who was in Thiruvananthapuram, and his counterpart GR Anil. “We will ensure MSP for farmers in our State and assure good quality rice for consumers in Kerala,” the Andhra Pradesh minister said.

Favourite variety

A high-level delegation is in Kerala on the Pinarayi Vijayan Government’s invitation to discuss the possibility of growing the “Jaya Bondalu” variety, which is very popular in the State. “It’s a variety that is parboiled to retain the grain strength. We don’t consume it in our State. After the Food Corporation of India stopped procuring the parboiled variety grown in the rabi season, our farmers have stopped growing it,” a top official told businessline.

This particular variety is grown by farmers in East and West Godavari districts (undivided), referred to as the rice bowl of Andhra Pradesh. “Since it is a favourite variety in Kerala, they approached us to supply at least  one lakh tonnes of paddy. We need to discuss the issue with Chief Minister Jaganmohan Reddy and, then, the Agriculture Ministry to decide on how to go about it,” the official said.

The finer details of the deal such as the price to be paid and the timeframe for supplying paddy are yet to be finalised.

Asked if the farmers would get additional incentives, the official said it was not clear yet. “We are awaiting the final outcome of the discussions,” he said.

The delegation was still in Kerala holding discussions with its counterparts there at the time this report was published.

Kerala will also procure red chilli, Kashmiri chilli, coriander seeds, chickpea, and cowpea from Andhra Pradesh. The Vijayan government had switched to direct procurement process and turned to Andhra Pradesh to do away with the role of middlemen, and bring the galloping prices of foodgrains and grocery items under control. This had come after random surveys feted the State for the most effective check on inflation.

Prices had skyrocketed through the last month, which was blamed on supply side blues exacerbated by damage to standing crops due to rain and floods in the growing States. The retail price of “Jaya” rice had shot up by ₹15 over the past month. The “Matta” variety price also increased by a similar margin during the period.

Traders are of the view that the runaway prices may not stabilise until at least January next. Apart from lower production in Andhra Pradesh and Karnataka, they blame the impost of 5 per cent of GST on packed rice. The season may have started in Karnataka, but arrivals are poor. Most mills in the State are running on depleted stocks.

Acreage declines

Kerala’s internal production is ample enough to change market dynamics. Rice produced locally is mostly procured and stored by the State government. The area under paddy cultivation and total yield have declined sharply between 2005 and 2020, according to official statistics.

The extent of decline in area of cultivation is 84,692 hectares (30.71 per cent ) and in yield, 43,089 tonnes (6.84 per cent), according to Agriculture Statistics 2005-2020,  published by the Department of Economics and Statistics. The area under cultivation was 2.75 lakh hectares in 2005 and it dropped to 1.91 lakh hectares in 2020. Total production dropped from 6.30 lakh tonnes to 5.9 lakh tonnes.

However, P. Indira Devi, Emeritus Professor, Agricultural Economics, Kerala Agricultural University, said higher productivity has led to marginal rise in paddy production in the State. The productivity has gone up to touch 3,105 kg per hectare. A majority of the seeds used are high-yielding ones, which have the potential to realise a productivity of 6,000-7,000 kg per hectare. However, the traditional paddy varieties used earlier yielded 1,000-2,000 kg per hectare.

Kerala’s rice demand is estimated at 38-40 lakh tonnes per year. However, the local production is able to meet only 16 per cent of the demand, which is marginally up from five years ago. 

Wetland paddy cultivation dominates in the State which receives copious rainfall half the year, she said, adding that the government has introduced a scheme for the payment of ₹3,000 per hectare as royalty to the landowners of cultivable paddy lands for just conserving it.

WIth inputs from V Sajeev Kumar, Kochi

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