Profitability of rice farmers increases 73% in 4 years

The profitability of farmers in growing paddy in West Bengal, Punjab, Haryana, Uttar Pradesh, Bihar, Chhattisgarh, Andhra Pradesh, Telangana and Karnataka, has increased to an average ₹26,000/acre from ₹15,000 (or 73 per cent) during last four years, according to a market research firm.

“There are two major factors supporting the increased profits. One is better yield and the other is higher procurement of the crop (at minimum support price),” said Priyanka Mallick, CEO of Q&Q Research Insights.

The government’s rice procurement was a record 60.25 million tonnes (mt) in 2020-21 (October-September), which was nearly half of the production. The MSP at which paddy is procured has gone up by more than 16 per cent to ₹2,040/quintal in 2022-23 from ₹1,750/quintal in 2018-19.

The study covers 3,800 farmers in major rice growing districts across all those nine States and was conducted in kharif season from 2019 to 2022. The average land holding of the farmers who were part of the survey was 6 acres.

Rice yield up

According to Q&Q Research, average rice yield has gone up by 16 per cent in the last three years from 19.3 quintal per acre to 22.4 quintal an acre.

However, labour remains a key pain point for the grower, Mallick told businessline adding, there is 25 per cent increase in labour costs in the last four years. “Labour costs have significantly risen in four States —Karnataka, West Bengal, Punjab and Bihar. Growers are on the look out for better technology like drones and more effective pesticides to reduce sprays,” Mallick said.

Pest management

Even as profitability of rice farmers has been growing, growers still remain concerned about pest and disease management in most parts of the country, said Mukta Sirohi, chief operating officer of Q&Q Research.

She said 60 per cent of the growers surveyed by the firm has attributed the local retailers as most influential on their decision making to buy any agri input. “This is majorly true for pest management and crop protection brands they should use,” Sirohi said. Apart from retailers, peers or other fellow farmers are the other influencers.

“Retailers do have preference for brand recommendation, and it is often governed by margins that companies provide,” said Megha Joshi, a vice-president in the firm.

Farmers are also taking interest on direct seeded rice (DSR) cultivation (in which transplanting does not require) and are shifting to less labour-intensive crops, Mallick said. DSR system has been gaining momentum in traditional transplanting markets like Punjab, Haryana, UP and Telangana. However, weed management needs to be addressed by agri input companies to increase its adoption, she said.

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