Sri Lanka seeks rice bailout from China after fertilizer ban
Published on: January 28, 2022.
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Sri Lanka has sought a million tonnes of rice as a gift from China government ministers says which is expected to make good an expected crop loss from during the main Maha cultivation season from a chemical fertilizer ban.
Sri Lanka had sought the million tonnes of rice as a gift as a way mark a 30 year long barter agreement between the People’s Republic and Ceylon which ran from 1953 to 1982.
Trade Minister Bandula Gunewardena said the donation was sought during an virtual meeting with the Chinese ambassador to Colombo with the 30 years being market on December 18, 2022.
“The response was very positive from China,” Minister Gunewardene told state-run ITN television.
“What we asked was for a gift of one million metric ton of rice as paying respect for the 3 decade agreement that went on without changing under various governments.”
A million tonnes of rice is worth between 350 to 500 million dollars at current market price for Indica rice grades.
Sri Lanka’s main Maha cultivation season that end around March produces about 2.5 million metric tonnes of paddy (rough rice) and up to 3 million tonnes in good years.
About 1.9 million tonnes of milled rice is produced from a good season, which is enough for over 9 months of use at around 195,000 metric tonnes a month. Output can fall to around one 1.5 million tonnes in drought years.
A million tonne gift from China will make good a crop loss of up to 50 percent. Sri Lanka’s cabinet of ministers also relaxed import controls to allow 300,000 metric tonnes of rice from India.
Finance Minister Rajapaksa said in January the government will buy paddy at 75 rupees a kilo to make good a 30 percent crop loss as part of 220 billion rupee ‘relief package’.
Sri Lanka’s farmgate price for rice was around 50 to 60 rupees. But millers said it had risen to around 95 rupees at the beginning of the current harvest season which is just beginning. Farmers are also complaining of steep harvest losses.
Source: https://economynext.com/sri-lanka-seeks-rice-bailout-from-china-after-fertilizer-ban-89819/
