Regoverningmarkets Newsletter (Vol. 32, No. 47 November 03 – November 08, 2007)

Drakteng to cultivate new paddy variety Friday, November 02,2007 BBS

THIMPHU: Farmers in Drakteng gewog in Trongsa can soon grow a new better yielding paddy. With the new variety, farmers can get about 200 kilograms more than other varieties of paddy from an acre of land. The Dzongkhag agriculture sector and local farmers have been conducting trail cultivation of six different varieties of paddy at Samchoeling village in Drakteng gewog.

The Dzongkhag agriculture sector and the RNR research centre are providing the technical support including seedlings and fertilizers.

Local farmers are doing the manual work. The district agriculture officer said they are conducting the trail to boost production.

Cultivable land is limited, he said, and the only way of enhancing production is by introducing better yielding varieties.

Of the six varieties, they have found that Khangma Marp gives better yield. Khangma Marp gives two tons of rice from an acre of land.

From the local variety which is currently grown, farmers can get only about 1800 kilograms of rice.

Apart from enhancing paddy production, they are also looking at vegetable and fruit production. Local farmers said they are also happy with the trial production.

Many said they want to try and cultivate the new variety from next season.

Farmers receive certified seeds Friday, November 02,2007 PAJHWOK

KABUL: Farmers across Afghanistan are for the first time receiving certified seeds of international quality standards to sow their wheat crop this autumn season, a UN agency has said.

UN's Food and Agriculture Organisation said around 8,000 metric tonnes of the new certified seeds of 22 improved wheat varieties for both irrigated and rain-fed conditions were being supplied by implementing partners - Seed Enterprises - of the FAO Variety and Seed Industry Development Project.

"The project is implemented in close collaboration with the Ministry of Agriculture, Irrigation and Livestock (MAIL) and supported by 10 million funding from the European Union for five years," FAO said in a statement.

Earlier in the month, a participatory workshop at the FAO Conference room in Kabul, where up to 60 seed producers from all over Afghanistan gathered to finalise production planning for the 2007/08 cropping season. Participants were drawn from private enterprises, NGOs as well as government stations involved in agricultural research and seed multiplication.

The workshop was organized by the Variety and Seed Industry Development Project, which is being implemented collaboratively by FAO and the Ministry of Agriculture. Recent developments taking place in the Afghanistan seed sector are in accordance with the National Seeds Policy that was adopted in 2005.

The purpose of the workshop was to give producers an opportunity to freely select the type of crop varieties and corresponding amounts of foundation seed they desire, and the quantities of certified seeds they would like to produce and sell next year.

In order to help the producers in making informed decisions, FAO said, it provided real time market survey data and results on variety preference and seed demand at province and district levels nationwide to ensure that both supply and demand sides of seed production match as closely as possible in order to meet the actual needs of farmers.

'Fertiliser crisis due to distribution' Monday, November 05,2007 NEW AGE

DHAKA: The high-powered committee on fertiliser management, at a meeting on Sunday, reviewed the overall situation of fertiliser procurement and distribution across the country.

The meeting also formed a committee, to be led alternately by additional secretary of the agriculture ministry CQM Mostaque Ahmed and a deputy governor of the Bangladesh Bank, to fix up and monitor fertiliser prices after dissolving the two separate committees working to that end.

The committee has identified 26 locations in 18 districts that are facing fertiliser crisis at the distribution end, according to sources. It has also suggested the filing of a criminal case against Abdul Mannan Mohaldar, owner of M/S Mohaldar Trade in Satkhira, for allegedly withdrawing 64,000 tonnes of fertiliser against an allocation of only 14,000 tonnes by means of forgery in 2005-06.

Committee members - agriculture adviser CS Karim and industries adviser Geeti Ara Safiya Chowdhury - attended the meeting along with others at the agriculture ministry with education adviser Ayub Quadri in the chair.

Karim rejected media reports on fertiliser shortage in the country, but admitted that there were some problems at the distribution end.

‘This time we have in stock more fertiliser than is required. The overall fertiliser procurement and supply situation is not bad,' he told reporters after the meeting.

Karim said distribution had been restricted to check misuse of the highly subsidised fertiliser. Each 50 kg bag of urea costs Tk 1,500, but is sold for Tk 300 to farmers, he pointed out.

On Monday Karim assured farmers that the government would not increase the prices of various kinds of fertiliser at the moment. He said the government was thinking of introducing the card system for farmers to ensure smooth distribution of fertiliser next year.

Meanwhile, the authorities concerned have taken the initiative to set up six warehouses in Noakhali, Comilla, Patuakhali, Mymensingh, Kushtia and Tangail for building up buffer stocks of fertilisers.

The estimated demand for urea in the current fiscal year is 28.18 lakh tonnes, against the local production capacity of 15 lakh tonnes.

The government will procure 4.5 lakh tonnes of urea from Kafco and import nine lakh tonnes to meet the demand, according to official records.

The places facing fertiliser crisis due to problems in distribution are located in 18 districts that include Satkhira, Kushtia, Jhenidah, Magura, Rajshahi, Jessore, Chapainawabganj, Faridpur, Jamalpur, Netrokona, Pabna, Chuadanga, Sunamganj, Sherpur, Tangail, Manikganj and Bagerhat.

Colombo Tea Auction to be automated Monday, November 05,2007 Daily Mirror

COLOMBO: The first Tea Auction in Colombo was held on 30th July 1883 in the offices of Somerville & Co., down Queen Street now renamed Janadhipathi Mawatha. At that time there was much criticism and opposition to this attempt by Somerville & Co. to create a new avenue for the marketing of Ceylon Tea.

Prior to this, Ceylon teas were shipped to the London Tea Auction or sometimes directly to overseas buyers, many of whom had an interest in the plantation industry. Even on the day of the first Auction there were several questions asked and consequently the Auction commenced later than scheduled.

The Auction itself was only modestly successful with only one lot of Kabaragala un-assorted tea selling for cents 45 a pound whereas the other 4 lots remained unsold due to either lack of bids or due to bids received not meeting the Broker's expectations.

Notwithstanding this disappointing start Somerville & Co. and the other brokers persisted and were able to conduct auctions on a regular basis from 1885.

Therefore, there arose a need for an organization to formulate rules for the conduct of the Tea Auction and in 1894 the Ceylon Chamber of Commerce formed the Colombo Tea Traders' Association to "promote the common interest of buyers and sellers of tea in the Colombo market".

From these modest beginnings the Colombo Tea Auction has grown to be the largest tea auction in the world in terms of the number of lots sold.

Mombasa in Kenya has for several years been the largest tea auction in terms of the volume of tea traded.

The Colombo Tea Auction has seen many changes over the years as it evolved to meet changing circumstances.

The Colombo Tea Auction was originally conducted in the Ceylon Chamber of Commerce Building in Chatham Street on one day of the week on a regular basis in one auction room.

As more and more tea was being sold through the Colombo Tea Auction and the number of lots increased the auction split over to the second day.

With the further increase in the number of lots the Board Room of the Ceylon Chamber of Commerce building was converted into a second auction room.

The new Ceylon Chamber of Commerce building at Nawam Mawatha made provision for 2 custom built auction rooms, but in the course of time this too proved to be insufficient and today the Colombo Tea Auction is conducted on 2 days of the week concurrently in 3 auction rooms.

Other innovations in the tea trade included the shift from solid wood boxes to Plywood cases to paper sacks, metrication with lots being in multiples of 10 and not 12, the change from Pounds to Kilograms and the shift from a Monday/Tuesday auction to a Tuesday/Wednesday auction. All these changes were opposed by sections of the trade when they were first proposed, but decisions were taken in the best over all interest of the trade and today no one would want to undo any of these changes, which have had a long term beneficial effect on the entire trade.

Today with tea factories increasing the number of grades to meet buyer demand the number of lots are correspondingly increasing placing a further strain on the system. As it is an auction on 2 full days namely Tuesday and Wednesday results in a severe strain on buyers having to taste, grade and evaluate up to 12,000 different lots of tea during the other days of the week, so that they could be prepared to bid for teas at the next week's auction. Unfortunately even now several buyers find it difficult to do so and in an auction where the numbers of lots are around 10,000 to 12,000 several teas especially those from not so well known selling marks of factories remain un-graded or not adequately graded and often sell for less than their true worth.

Since the obtaining of a fourth auction room is both an expensive and impractical option at this stage the Colombo Tea Traders Association appointed a Sub-Committee consisting of all relevant stakeholders to look at the merits of using modern technology to automate the Colombo Tea Auction and thereby increase efficiency while hopefully bringing down operating costs. This Sub-Committee has spent a considerable time looking at different options of reducing the auction time which would enable buyers to spend more time evaluating their teas and therefore be in a better position to bid on all teas suitable for their requirements at the next auction. Many of the senior members of the committee were also mindful of the concern which senior staff members of their own organizations had when they computerized their company's operations in the last quarter of a century.

After a long process of evaluation the Colombo Tea Trader's Association has selected Millennium Information Technologies to partner them in the proposed automation of the Colombo Tea Auction. Millennium Information Technologies would provide the technological input while the Automation Sub-Committee and the Industry Group which was appointed from among the younger members of the stakeholders, many of whom have grown up with computerization and think of modern technology as an indispensable part of their lives provided the specialized tea knowledge. Millennium Industrial Technologies has an excellent track record having among other things successfully computerized the Colombo Stock Exchange.

The aim of the partnership between the Colombo Tea Traders' Association and Millennium Information Technologies has been to evolve a auction system unique to the Colombo trade embodying and enhancing the positive features of the Colombo Tea Auction built up over the years. Other Tea Auction centers in Kenya and India have automated to varying degrees with different levels of success. It was however decide that we should only look at these systems for guidance and experience and not re-produce any of their features which do not form a part of the current outcry system at the Colombo Tea Auction. There are those who feel that automation should be all encompassing. For example at the recent International Tea Convention in Colombo during the Discussion on the Proposed Automation of the Colombo Tea Auction, the Head of the Unilever International Tea Operations criticized the propose system as simply re-producing the current outcry system and not making full use of the available technology. This International Tea Convention had Tea Experts from around the world focusing on the long term sustainability of the Tea Industry. A key element of the marketing of tea is stability. Most tea reaches the consumer in a branded form, in packets or tea bag or whatever that contains tea of a consistent quality, week in week out, year in year out. If there was concern about the sustainability of the system packers would take action to alter their blends to meet anticipated changes before these are thrust upon them. For example: an announcement some years ago that Sri Lanka would be shifting a significant portion of it's manufacture to CTC production resulted in several packers removing the Ceylon component of their blends anticipating the non availability of adequate quality of Ceylon Orthodox Tea in the future. As it happened the change did not take place, but the country lost several regular buyers.

The proposed automation of the Colombo Auction is progressing at a slow space in an attempt to ensure the stability and long term sustainability of the Colombo Tea Auction. There are those who criticize this approach but it is felt that in the long term it is necessary to persuade all stakeholders of the benefits of computerization rather than for it to be thrust upon them. This gradual approach means looking at the individual parts while not losing sight of the overall picture. For example computerization of all pre and post auction documentation would have an immediate benefit on the trade while facilitating further automation.

The ultimate aim is for the Colombo Tea Auction to be more transparent and less costly to operate thereby increasing competition resulting in a win-win situation for all participants and stakeholders.

Anger at legal Afghan opium plan Monday, November 05,2007 BBC

KABUL: Afghan and international narcotics experts have strongly criticised a proposed pilot project to grow opium poppy legally in Afghanistan for use in medicines. The scheme is the brainchild of the Senlis Council, a think-tank working on security, development and counter-narcotics issues.

It has the backing of the European Parliament and will go to European Union foreign ministers for consideration at a meeting later this month.

But while the idea is unlikely to win the support of ministers, the parliament's move has left officials in Afghanistan fuming.

The Senlis Council argues that efforts to eradicate poppy cultivation haven't worked. Worse still, it says, eradication programmes have driven poppy farmers into the arms of the Taleban.

So why not cut the ground out from under the feet of the warlords and the Taleban, without depriving poor farmers of their livelihoods? Why not set up pilot projects where whole villages would be licensed to grow poppy legally? It's been done successfully in India, Thailand and Turkey, so why not Afghanistan?

Successful model

This is the core of the Senlis proposal. The poppy would be processed into morphine for medical use, using laboratories based in Afghan villages.

The licences would be given to villages, not individual farmers. If one farmer sold poppy for heroin, the whole village would lose its licence. This is the model followed successfully by microfinance projects elsewhere.

Norine McDonald of the Senlis Council says it's the only viable alternative. Poppy cultivation is increasing; efforts to switch farmers to alternative livelihoods have been unsuccessful.

Southern Afghanistan, where most of the opium poppy is grown, has suffered from a drought for several years.

Poppy is a notably drought-resistant crop. Farmers would need expensive irrigation systems to switch to other crops, she says.

"The idea that southern Afghanistan has an agricultural future is false," she argues.

"By allowing pharmaceutical processing at village level, young men can be trained for light industrial work. This is important for the future of Afghanistan."

'Supporting terrorism'

But officials working to stem the opium trade from Afghanistan are appalled.

"Poppy is supporting terrorism and drug dealers," says Afghanistan's acting narcotics minister, Khodaidad (who, like many Afghans, has only one name).

"The Senlis Council and the European Parliament are supporting insecurity in Afghanistan."

Afghanistan's mullahs issued a fatwa (decree), saying people must not grow poppy because it is haram (forbidden in Islam), he says.

Opium is banned under the Afghan constitution, and the government opposes any form of legalisation.

Licensing the sale of poppy for medical purposes won't get rid of the demand for illegal opium, warns a British narcotics official in Afghanistan who preferred not to be named.

In fact, he believes it would just create a new cash crop for farmers, meaning that even more opium would be grown.

Many farmers grow poppy under duress, he points out. The Afghan police would be hard-pressed to stop drug traffickers from forcing farmers to divert part or all of their crop for heroin.

"Afghanistan needs a rule-of-law structure to stop people growing opium," he says. "But if it had a rule-of-law structure, it wouldn't have an opium problem in the first place."

Incentive?

A European Commission (EC) document obtained by the BBC argues that buying poppy from farmers could have a perverse effect.

"Farmers could see this as an incentive to further expand production. This would not be an appropriate use of resources for the international donor community or the Afghan government."

And the UN Office on Drugs and Crime (UNODC) has serious reservations.

"At the moment, in the Afghan context, any proposal should be taken with utmost caution," says Jean-Luc Lemahieu, the head of UNODC's Europe and West and Central Asia desk.

The idea of laboratories in the villages is problematic, he says.

"Where will the precursor chemicals [needed to convert poppy into opiates] come from, and who will control them?" he asks. "Who would ensure they're not diverted to other frameworks?"

The Senlis Council says there's a shortage of medical opiates on the world market, especially in developing countries, which Afghanistan can fill. But the British narcotics official disputes this.

The International Narcotics Control Board, which licenses countries to produce opiates legally, has a two-year surplus, he says. "Developing countries don't have opiates, but they don't have penicillin or aspirin, either," he adds.

And he questions the economic benefits the Senlis scheme would bring. The price of legal opiates on the world market is $35 to $40 a kilogram. Illegal opiates fetch nearly three times as much, around $100 a kilo.

The EC says "exorbitant subsidies" could be needed to bridge the gap between legal and illegal prices.

'Not ready'

In the end, the British official says, poppy-for-medicine would undermine the authority of the Afghan government. It would be impossible to justify allowing one village to grow poppy under licence while eradicating the same crop just a few kilometres away.

Counter-narcotics experts acknowledge that similar schemes have worked in other countries which used to have a serious drug problem, such as Pakistan and Thailand. But Afghanistan, they say, just isn't ready.

With violence and instability still wracking the country, they fear that any move to legitimise poppy production could make a bad situation even worse.

Seed crisis hits boro, wheat farming Wednesday, November 07,2007 NEW AGE

CHAPAINAWABGANJ: FARMERS of Chapainawabganj may not achieve the target of boro and wheat cultivation due to acute seed crisis.

According to the local Department of Agriculture Extension, a target has been set to cultivate boro on 44,940 hectares of land while wheat on 15,000 hectares in the district during the current season. The farmers need 990 tonnes of boro seeds and 1,800 tonnes of wheat seeds to achieve the target.

A number of farmers said they would start preparing boro seedbeds and wheat cultivation in the middle of the current month. But they are apprehending that they might not achieve the target as the Bangladesh Agriculture Development Corporation and its appointed dealers have failed to supply them with adequate seeds.

The farmers said usually they store seeds every season but they failed to store seeds this year due to flood and other natural calamities and were now depending on BADC's seed due to its high quality and reasonable price.

Local agricultural officials, however, denied the seed crisis and said that farmers had stocked sufficient despite natural calamities but they were depending on BADC's seeds due to its high quality and reasonable price.

Assistant director of the local BADC Hasan Toufiqur Rahman said the BADC received 75 tonnes of seeds for boro cultivation in the district and of the total, 14 tonnes were sanctioned for its sale centre and the rest seed to its 16 dealers. He also said the sale centre sold out the seeds during the last part of October and dealers had almost finished their quota. He further said the BADC had urged the higher authorities to sanction more seven tonnes of boro seed to meet the increasing demand.

BADC officials said 130 tonnes of wheat seeds had been allocated for the district, which will be available within a week. The farmers will have to manage the rest of the seeds.

Spinners to slow down cotton purchases Wednesday, November 07,2007 DAWN

KARACHI: Spinners have decided to slow down their raw cotton purchases to ensure that prices are not pushed due to their panic-buying in the domestic market. In an emergent meeting called in Lahore on Monday, the All-Pakistan Textile Association (Apta) members deliberated at length raw material situation prevailing in the country for textile industry.

Though members expressed concern over high prices of raw cotton and polyester fibre, they were unanimous that current cotton crop size is not bad and local lint cotton is almost at parity with imported cotton.

Consequently, it was unanimously resolved that spinners should slow down their purchases and only meet their current and immediate demand.

It had been the practice of textile industry to purchase cotton stocks during the first three months of each cotton season (October to December), and this results in price-hike.

The large industrial groups, having huge bank finance facilities, are the main cause of surging prices at the start of each cotton season, analysts said.

The participants of the meeting lauded the government for allowing three per cent subsidy in mark-up rate to spinning industry.

It was, however, pointed out that benefits of the scheme as per its current state of mechanism are not available to the entire spinning industry.

The Apta urged the government to tailor the three per cent subsidy in such a way so that all spinning units throughout the country could benefit from it, regardless of any default, swap or rescheduling of loans.

The spinners also demanded that loans from leasing companies should also be included in the ambit of the scheme.

It was also demanded of the government to allow imports of cotton of all categories and qualities from India through Wagha border and duty-free import of polyester should also be allowed without any further delay as the industry is presently paying high cost for lint cotton and polyester fibre.

There was strong argument from members that current lint cotton rates (ranging between Rs3200 and 3300 per maund) and polyester fibre rate that has recently increased to Rs97 per kg, may further increase owing to closure of some large polyester fibre manufacturing units in the country.

In order to off-set the bad affects of these developments, the Apta members demanded free import of polyester fibre and lint cotton import from India through Wagha border.