Minimum price for green leaf demanded. Sunday, August 12, 2007 HINDU [1]

CHENNAI: With no signs of an end to the deep crisis confronting the small tea growers of the Nilgiris, they have now demanded a ‘floor price' for the green leaf produced by them. In other words, they want a minimum support price (MSP) of Rs. 10 a kg for the produce from the small growers.

Both the Centre and the State governments extended a special subsidy scheme for the Nilgiris' small growers, offering them Rs. 2 more than the market or auction price. In 2000, the Centre offered a price subsidy for made tea, but only for about six months, to the tea producers. Later, in 2005, the State government extended a lump-sum subsidy directly to the small growers.

The contention of the small growers and the Save the Nilgiris Campaign (SNC) is that ad hoc relief measures only add to the uncertainty, and do not solve the problem faced by the small growers. They cite the example of prices fixed for many commodities in the past to argue the case for an MSP type floor price for the green leaf.

"There is a provision under the Tea Act for fixing a floor price. As there is no public or State procurement of tea, there will be no burden to the government. The Tea Board can ensure the success of this proposal as it enjoys control over the tea factories," argues D. Venugopal of the SNC. It has been estimated that there are about 65,000 small growers in the Nilgiris, with a planted area of about 40,000 hectares. They produce around 300 million kg of green leaf. The total earnings from small growers' tea in the market have been estimated at just over Rs. 600 crore.

According to some of the small growers, despite the continuing crisis for six years and more, and the very low price they get at the auctions, the average price of tea in the market for the consumers has hovered around Rs. 80 a kg. Even with a floor price of Rs. 10 to the small growers, there will be no impact on the consumer market. The margins have improved, while the producer remains in the grip of a severe crisis. Though auction prices have fluctuated, the three-year average for the small growers works out to just about Rs. 5 a kg.

What sparked the tea crisis in the ‘Queen of Hill stations' was the break up of the Soviet Union and the growth of a strong Russia, a market which imported mainly tea from the Nilgiris but virtually gave up this product and went to other sources, plunging both the Badaga growers and the Sri Lankan repatriate workers in a crisis. A long-term solution now being suggested is diversification. In the 1980s, the small growers switched over from vegetables to tea, because of the boom. Now they are being advised to get back to vegetable cultivation or crop diversification.

Tea exports takes a beating. Monday, August 13, 2007 The Telegraph [2]

KOLKATA: Tea exports for the first six months of 2007 dropped 11.8 million kg. Export earnings also dipped Rs 9.12 crore.

Kenya, which had a bumper crop this year, reported a 24.7 per cent jump in exports at 151.3 million kg till May this year against 121.4 million kg in the year-ago period.

China also recorded an 8.7 per cent rise in exports at 121 million kg.

Sri Lanka, however, registered a drop in exports at 112 million kg compared with 123.3 million kg because of labour problems.

In India, exports from the north rose to 35 million kg from 33 million kg, while those from the south were down to 39.7 million kg from 54.5 million kg.

Tea auctions in north India saw a rise in volumes for the first half of the year to 116.3 million kg from 114.7 million kg a year ago. This comes at a time when the Tea Board and the commerce ministry are planning to implement the e-auction system. In terms of value, the price slightly declined to Rs 69.72 per kg from Rs 70.79 per kg in the corresponding period of the previous year.

In the south, the volumes dipped to 59.2 million kg from 65.5 million kg. The value, however, improved to Rs 52.58 per kg from Rs 49.26 per kg in the year-ago period.

The rising rupee added to the woe of exporters. Branded tea companies such as Tata Tea have lost around Rs 3 crore on a stand-alone basis and Rs 10 crore on a consolidated basis.

McLeod Russel India, one of the largest tea producers, also expects a drop in exports to around 21 million kg from 25 million kg last fiscal.

Crops worth TK 5.91 b damaged by flood. Tuesday, August 14, 2007 NEW AGE [3]

DHAKA: Standing crops, jute, vegetables and seedbeds worth Tk 591.29 crore on about 1.10 lakh hectares of land in 56 districts have so far been affected in the ongoing flooding, according to a preliminary report of the agriculture ministry.

The report, finalised on Saturday, was forwarded to the finance ministry on Sunday with a request for funding for post-flood rehabilitation of the agriculture sector, especially the marginalised farmers, sources in the ministry said.

According to the report, aus paddy on 22,996 hectares has been damaged fully or partially, causing a production loss of 45,532 tonnes worth Tk 95.61 crore.

Aman paddy of 47,676 hectares has been affected fully or partially causing a possible production shortfall of 87,221 tonnes worth Tk 209.32 crore.

The flooding has affected 347 upazilas and so far damaged seedbeds on 11,839 hectares of land worth Tk 13.02 crore.

Besides, jute cultivated on 6,558 hectares of land has been damaged fully or partially causing a loss of Tk 72.14 crore to farmers.

Vegetables produced on 14,302 hectares of land worth Tk 171.62 crore have also been damaged, the report says.

Damage to crops under the head of ‘others' has been estimated to be Tk 29.56 crore, it says.

The finance ministry on August 9 allocated Tk 30 crore to the agriculture ministry to meet the flood exigencies.

Officials concerned said the government would undertake a holistic programme to mitigate the plight of the farmers.

‘We are now planning to make urgent allocation to farmers for fertiliser and seed,' a high official in the finance ministry told New Age. The World Bank has recently expressed its fear that the GDP growth in the current fiscal year may fall to 6.8 per cent from the earlier estimate of seven per cent because of the ongoing flood, while inflation and budget deficit may go up.

The global lender made the forecast at a meeting between the government and development partners at the National Economic Council conference room on August 8.

‘Inflation will rise further in the next couple of months, while food prices in particular remain the biggest concern for the donors as they observed that the flood this time is making it worse,' said a report of the bank placed at the meeting.

The bank's apprehension about slower GDP growth was based on the feared decline in farm and industrial outputs, previously estimated at 4.2 and 8.5 per cent respectively.

Fertiliser price up by Rs50 per bag. Wednesday, August 15, 2007 DAWN [4]

LAHORE, August 14: Fertiliser companies and dealers have increased price of Di-Ammonium Phosphate (DAP) bag by another Rs40. This is fifth increase in last eight months.

The Agri-Forum Pakistan (AFP) on Tuesday protested against the increase in a letter to the provincial governor. It said that a DAP bag, which was available at Rs900 in January, was now being booked at Rs1,273 - the price includes Rs470 subsidy per bag.

The manufacturers and importers have asked the dealers to sell the fertiliser bag at a price of Rs1,288. If the subsidy is also included, the price increase would come to 100 per cent in this variety of fertiliser, it said. Wheat, which consumes over 60 per cent of DAP, is sown in September and October in Sindh and October and November in the Punjab.

With the sowing season coming up the fertiliser manufacturers and importers have joined hands to exploit the occasion to mint money, it alleged.

Agri crisis looms: Sengupta panel. Thursday, August 16,2007 Asian Age [5]

NEW DELHI: "Farmers are the backbone of our nation," declared Prime Minister Manmohan Singh from the ramparts of the Red Fort on Wednesday. And yet, India is experiencing an "agrarian crisis", evident from the spate of farmers' suicides. Ironically, this observation comes from none other than the National Commission for Enterprises in the Unorganised Sector, which was constituted by Mr Singh's government.

The commission has said that the magnitude of this crisis can be gauged from the "spate of farmers' suicides in the recent past, especially in the states of Maharashtra and AP."

It has suggested that a safety-net programme be introduced so that farmers are assured of a minimum income. It also says that a universal social security system for farmers - to take care of their health expenses, life and unemployment insurance and old age pension - is necessary.

The commission in its "Report on Conditions of Work and Promotion of Livelihoods in the Unorganised Sector" notes that growing indebtedness among farmers, particularly the small and marginal ones, has led to a spurt in suicides among them.

The agriculture sector consists almost entirely of unorganised workers, says the report. The commission, headed by noted economist Arjun Sengupta, submitted its report to the PM about a week before the nation celebrated its 60th year of Independence. As is evident from the report, the small and marginal farmers remain shackled in debt.

The report notes that there has been a spurt in distress-driven farmer suicides in states like Punjab, Kerala and Karnataka too, the primary reason being indebtedness. The incidence of indebtedness among farmer households was highest in Andhra Pradesh (82 per cent) followed by Tamil Nadu (75 per cent) and Punjab (65 per cent). The report says that the average outstanding loans among indebted farmer households is Rs 25,985 per household with indebtedness among sub-marginal households being Rs 14,866. It also takes note of the debt-trap that farmers fall into when they are forced to borrow money from private moneylenders and traders to meet both production and consumption needs.

Clearly, the "new deal to rural India" as the PM put it wherein the government has "doubled the supply of credit to farmers...where farmers have been in distress, we have written off interest and rescheduled loans" has had little impact on the country's small and marginal farmers who are bearing the brunt of this crisis.

The report, in fact, notes that small and marginal farmers are part of a "highly impoverished group, one whose problems have increased following the slowdown in agricultural growth during the 90s."

Of the estimated 259 million agricultural workers in 2004-05, 64 per cent are self-employed or farmers as they are commonly described. Among them, the small farmers operate 47 per cent of the agricultural land, says the report. It notes that price fluctuations in the global market to which farmers are now exposed, thanks to liberalisation, has increased the risk factor for them. On farmer suicides, it observes: "In most cases, the victims were small and marginal farmers who could not sustain frequent price shocks. With mounting debts, along with the rising risks in production and price fluctuations leading to low remuneration, it is no wonder that a lot of distress is generated among farmers."

Agriculture heading jute way: traders. Thursday, August 16,2007 NEW AGE [6]

DHAKA: The country's top business leaders have expressed their fear that the government's current lender-dictated policy towards agriculture ‘is certain' to plunge the entire sector towards destruction, much like as has happened with the once-flourishing jute sector. ‘We consider the ... policy is certain to harm the core of our economy - agriculture - much along the same line as it happened to our "golden fibre" - jute,' claimed the top executives of 14 trade bodies in a press statement released on Wednesday The business leaders strongly suggested that the government should provide agriculture subsidy to keep farmers interested in food production and to protect them from global competition, as well as revise its stance on increasing interest rates on agricultural loans.

They argued that the US, the EU and other industrialised nations highly subsidise their agriculture sector ‘to keep their farmers interested in food production as well as to protect them in the wake of international competition from developing countries'. Some emerging economies are also taking measures to lower interest rates and provide other fiscal support both for agriculture and industry ‘to be competitive in a globalised market place'.

‘On the contrary, we, in Bangladesh are doing the reverse without considering the ground reality and the consequences that the nation will face after this devastating flood,' the statement read.

The business leaders opposed the decision to increase interest rates on agriculture by the Bangladesh Krishi Bank and the Rajshahi Krishi Unnayan Bank at a time when the agriculture ministry reported that standing crops, jute, vegetables and seedbeds worth Tk 591.29 crore on about 1.10 lakh hectares of land in 56 districts have so far been damaged by the ongoing floods.

‘It is unfortunate that on the one hand we urge the farmers to produce more, and on the other, discourage them by increasing interest rates on agriculture credit at a time when they need more support than anytime before,' the statement read.

The government has anticipated food shortage and decided to import 50,000 tonnes of food grain at a higher price compared with local and international prices. In this situation, increasing interest rates might ‘create havoc' for the government to overcome the current damage to food grain production, the statement read.the impending decision by BKB and RAKUB to charge higher interest rates for agricultural loans reportedly under pressure from the World Bank will boomerang and is likely to create havoc for the government to overcome the current damage to food grain production

‘Charging higher interest rates (increasing from 8-12 per cent) at this critical juncture will increase the cost of food production and will add further fuel to the already rising rate of inflation. It may also be recalled here that Breton Woods prescriptions for upper adjustment of gas as well as fuel prices will lead to further increase in the cost of over-all production process including major agricultural input - fertiliser, thus adding insult to injury.' The businessmen added, ‘Bangladesh emerged from a food deficit country to near self-sufficiency mainly due to the resilience and hard work of the farmers and the supportive policies adopted by successive governments.

‘The agricultural sector grew at 4.5 per cent in FY2006 ... Due to flood losses, [the Asian Development Bank] has already revised downwards its earlier projection of 3.2 per cent in Fy2007 and we apprehend that this will further decline and lead to a higher food deficit, if the government continues its policy of accepting outside prescriptions devoid of ground reality.'The business leaders iterated their ‘strong opposition' to the interest hike calling the decision in ‘self-defeating'.

‘In our opinion the decision should be the other way around; interest rates for the farmers should not be increased from the existing level of 8 per cent, if not decreased further. Moreover they should be provided with all inputs at an affordable price to increase crop production.

‘Side by side, we reiterate our earlier recommendation for lowering the interest rates for all investments to remain competitive in a free market; as has been followed by a number of countries including our neighbours.'

The 14 top office bearers of trade bodies also questioned the rationale of heeding to lender diktats when their contribution to the economy has been reduced significantly.

‘Time is now ripe to think as to how long we should continue with our present dependency on "donor advice" for the meagre foreign assistance which has declined to less than 3 per cent of GDP, the major share of which is credit and has to be repaid by the poor people of Bangladesh. ‘Moreover, we should also ask a relevant question: how much of this assistance is really available and can be used to meet our priority needs of development?'

The press statement was signed by Federation of Bangladesh Chambers of Commerce and Industry president Mir Nasir Hossain, International Chamber of Commerce, Bangladesh president Mahbubur Rahman, metropolitan chamber president Latifur Rahman, Dhaka chamber president Hossain Khaled, Chittagong chamber president Saifuzzaman Chowdhury, foreign investors' chamber president Masih Ul Karim, garment manufacturers' association president Anwar-ul-Alam Chowdhury, knitwear manufacturers' association president Md Fazlul Hoque, banks' association vice-chairman Muhammad A (Rumee) Ali, textile mills association president Abdul Hai Sarker, publicly listed companies' association president Samson H Chowdhury, jute mills association president Kamran T Rahman, insurance association acting chairman Nizamuddin Ahmed, and agro processing association president Amjad Khan Chawdury.

Vegetable import declining Thursday, August 16, 2007 THE KATHMANDU POST [7]

KATHMANDU: Despite a 26 percent jump in imports of vegetables from India over the last four years, Nepal's dependency on India for some major vegetable items has dwindle significantly, thanks to increasing commercialization in vegetable farming in Nepal.

According to Kalimati Fruits and Vegetables Market Development Board (KFVMDB) data, the items that witnessed sharp declines in imports from India are big and small tomatos, Red potato, pointed gourd and bitter gourd among others.

"Soaring commercialization of vegetable farming in Nepal has managed to replace major Indian farm products " Binaya Shrestha, planning officer at KFVMDB told the Post adding that consumers also prefered the Nepali vegetables as they were fresher.

According to the figure of KFVMDB, the total import of big tomato and small tomato from India shrunk to 857 Mt ton and 8 tons in 2006/07 respectively from 1,165 tons and 86 tons in 2003/04. Nepal used to import 2,643 tons, 98 tons, 96 tons of Red potato, pointed gourd and bitter gourd respectively in 2003/04. The figure has come down to 2535 tons, 29 tons, 62 tons in 2006/07 respectively.

However, the amount of white potato, dry onion, cabbage and cauli flower coming in from India has soared over the period. "Production of these items in Nepal has not increased enough to fulfill their ever-increasing demand" Shrestha added.

According to him, arrival of white potato, dry onion and cauliflower in Kalimati vegetable market stood at 1,078 tons, 8,288 tons and 45 tons respectively in 2003/04 where as the amount shot up to touch 1,664 Mt tons, 12,328 tons and 100 tons four years later.

With the increasing demand of some major vegetables coupled with their short supply from the domestic farms, import of vegetables from Indian has gone up by 26 percent to 17,863 tons from 14,129 tons over the period, states MFVMDB.

During the 4-year period, Nepali Pumpkin, Round Brinjal and Green Soybean have completely replaced those from India.

Banana no more boon for farmers Friday, August 17,2007 NEW AGE [8]

RAJBARI: Banana production in Rajbari has drastically fallen as a large number of farmers in all the four upazilas of the district stopped cultivation due to frequent losses.

Farmers have lost interest in cultivation of bananas in the district as the production is seriously affected by virus disease causing huge financial losses to them, local sources said.

Besides, high rise in the prices of agri input including bamboo, fertiliser and pesticides is discouraging the farmers to cultivate banana, the sources said.

Banana is the main cash crop of Baliakandi, Pangsha, Goalundo, and sadar upazilas of the district. Banana produced in the district met about 30 per cent of the country's demand.

As there is no banana research centre in the country, virus disease has taken a serious turn and farmers are unable to control it even after applying pesticides.

Sources in the agricultural extension department said during the last five years more than 2,000 acres of banana plants in the district had been damaged due to storm Popular varieties of banana, including Sagar, Sabri, Champa, Humai and Gara-bandar, were produced in the district on 10,000 acres of land in four upazilas but it has come down to 2,000 acres of land at present.

One Mokbul of Ramdia village and Shamoyl of Bahadurpur village in Pangsha upazila said they have already switched over to cultivation of paddy, papaya on the same plots instead of banana.

Habaspur village and Ratan Sikder of Belgachi village in Pangsha upazila told this correspondent that prices of bamboo, fertiliser and pesticides are increasing day by day.

‘We need Tk 18,000 to cultivate banana on one acre of land but the return we get is only Tk 21 to 25 thousand,' they said.

Many fallow lands and water-logged areas of the district could be brought under banana cultivation if proper steps are taken by the authorities concerned, they added.

Some banana growers said if financial and technological support are provided by the government they can produce export-quality banana.

They also urged the authorities concerned to provide them with easy loans to encourage them to cultivate banana.