Consumers feel compelled to stack up on rice purchases

By Malik Gunatilleke

Consumers and traders are saying rice stocks are not entering the market as freely as before, and that consumers are purchasing extra quantities of rice in fear of a shortage.

Stocks of domestically produced rice are finally entering the market, following a Government move to control domestic rice prices. But wholesale traders say some domestically produced stocks are being held back by millers who are waiting in the hope of an increase in prices.

Domestic rice now entering the market.

S. P. Samy, president of the Pettah Trade Association, told The Sunday Times that the market was receiving enough rice to meet demand, but stocks were not entering the market “as generously” as before. “Some millers have bought their stocks at high prices and they stand to lose if they sell at Government stipulated prices,” he said.

Mr. Samy said consumers were purchasing greater quantities of rice than before, fearing a shortage. “Customers who used to buy three kilos are now buying five kilos at a time, and spreading it over a longer period of time.”

He said rice stocks that can be sold at current prices were entering the market. He believed domestic rice stocks could last till June. Trade and Consumer Affairs Ministry Secretary Dr. R. M. K. Ratnayake said private millers would not be able to hold on to their stocks indefinitely. He pointed out that rice was still freely available in the market, and that the daily demands of consumers were being met without a problem.

Dr Ratnayake said the Government was confident a shipment of 50,000 metric tons of rice from Myanmar would reach Sri Lanka this month, despite concerns about a serious food shortage in that country following a cyclone last week that caused widespread destruction. He said the Sri Lankan Government had already paid for the shipment, and that the Myanmar Government would honour its trade commitment. “I have received confirmation that they are ready to load the three ships with 20,000 metric tons of rice, while the rest will come later,” he said. The Government has paid US$400 for a metric ton of Myanmar rice.

The shipment that was due to arrive in Sri Lanka before the National New Year last month has yet to leave Myanmar’s shores. Explaining the delay, Dr. Ratnayake pointed out that Myanmar had had a 10-day holiday period from April 10 to 20, and that the natural disaster that hit the country last week had crippled normal shipping activity, including the loading of cargo. The Ports Authority in Myanmar has not yet cleared cargo for loading.

There had been speculation that the Government would import rice from Thailand, but the Trade Secretary has said that rice imports from Thailand were costly and would not help the consumer, who would end up paying an additional Rs.15 to Rs.20 per kilo.