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Rice millers jittery over levy order

S. Rajendran

The proposal is to procure at least one lakh tonnes before March 31

33 per cent of the commodity produced in
State will be procured
Change in buffer stock position has triggered
the move

BANGALORE: Confusion prevails in the foodgrains market, particularly among rice millers, over a decision of the State Government to enforce the rice levy order to procure 33 per cent of the commodity produced in the State for the national foodgrains procurement pool.

The Government’s plan is to procure 33 per cent of the total rice produced from rich mill owners who otherwise sell it to wholesale and secondary markets and to Agricultural Produce Marketing Committees.

The difference between the open market price for rice and the levy price has become cause for concern among the rice millers.

For instance, Sona Masuri rice, which sells at Rs. 2,000 a quintal in the retail market, will fetch only Rs. 1,120 a quintal if the Government enforces the levy order.

‘No shortage’

Whether or not this massive procurement drive by the Government could lead to shortage in the local market is the big question.

Sources in the State Secretariat ruled out any shortage since the total rice production is estimated at around 25 lakh tonnes (the annual paddy production is around 37 lakh tonnes with an average recovery rate of around 67 per cent).

The Government has fixed a target of 2.5 lakh tonnes for levy procurement, if not 33 per cent of the total production.

Only rice of average grades is procured under the levy system while the fine and superfine qualities will be available in the open market.

Subsidised rate

Levy rice is procured by the State Government for making it available to those who are dependant on the public distribution system (PDS) which ensures the availability of foodgrains at a subsidised rate.

Strict enforcement of levy procurement was given a go-by during the past decade owing to ample buffer stocks both in the Central as well as State pools.

A dramatic change in the position of stocks has now prompted the Government to revert to the levy system.

P.N. Srinivasachary, Commissioner of the Department of Food and Civil Supplies, who has been holding discussions with the rice millers, told The Hindu here on Thursday that while the State had been obtaining an average of 1.4 lakh tonnes of rice every month from the Central pool for the PDS, the procurement here was very low.

The proposal is to procure at least one lakh tonnes before March 31 (kharif crop) and the remaining 1.5 lakh tonnes (rabi) in the next three months. While Andhra Pradesh has already procured 26 lakh tonnes, a similar quantity is made available to the central pool by a relatively small State such as Chhattisgarh.

Discussions sought

President of the Karnataka State Rice Millers Association, Paranna I. Munavalli said that rice millers were firm that the new levy system could not be complied with.

“We are willing to provide for the Central pool but the Government cannot kill our business by compelling us to part with a big quantity. There is also confusion in the Government on whether or not to procure 2.5 lakh tonnes or 33 per cent of the production. The onus is on the Government to hold discussions with the rice millers association rather than take a unilateral decision,” Mr. Munavalli added.

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