///Increased ‘opportunity cost’ in rice farming making it less profitable to farmers: Towfiq Khan

Increased ‘opportunity cost’ in rice farming making it less profitable to farmers: Towfiq Khan

2016-04-10T18:35:29+00:00 April 5th, 2016|CPD in the Media, Towfiqul Islam Khan|

Published in The Financial Express on Tuesday, 5 April 2016

Farmers ditching rice for cash crops

Price ‘deprivation’ during cereal harvesting seasons cited as reason

Our Correspondent

Farmers have gradually been switching from rice farming to cash and other profit-making crop cultivation due to price ‘deprivation’ during traditional cereal harvesting seasons in the country, farmers and officials said. Acreage of cash crops like jute, tobacco, cotton, and maize, some vegetables, leafy and fruits, pulses and mustard has increased significantly in last few years due to lower prices of paddy during the harvesting seasons.   Experts, however, expressed their mixed reaction over the matter as they saw it positively from ‘opportunity cost’ of view, but they became critical in the food security context. Md Majid, a farmer at Kandupara under Chandanpat Union in Taraganj upazila of Rangpur district, was too busy drying his tobacco. Talking to the FE at his courtyard recently, the 40-year-old farmer expressed his bitter experience over rice farming. He has expanded tobacco farming to four ‘dons’ of land from only one don (30 decimal) last year. “I have been in trouble for taking loans for paddy farming in last two years. But this year, I cultivated tobacco on four dons to get relief from the loan,” he said.    Like Hafijar Mian and Md Hannan, many other farmers were also present at his courtyard. They said companies gave them fertiliser, sapling, pesticide and an amount of money in advance for cultivating tobacco.   Price has been fixed at Tk 105 per kg this year. Majid was expecting to earn profit of Tk 54,000 from his four dons of land. Farmers said paddy prices came down to Tk 450 (hybrid) and Tk 600 (inbreed) per maund in last two years during harvesting period which have encouraged many farmers to shift to tobacco and maize cultivation. According to the Bangladesh Bureau of Statistics (BBS), rice land saw a significant plunge this financial year— by 0.197 million hectares of which Boro 0.14 million hectares.   The bureau predicts that rice production will decline this FY.   DAE data showed that jute farming started increasing significantly. Farmers cultivated jute on 0.7 million hectares of land last FY which is expected to increase to 0.75 million hectares this year due to an uptrend in raw jute prices. Tobacco cultivation has expanded to 0.08 million hectares of land in FY’15 from 0.051 million hectares of land in FY’12. DAE data showed that pulses cultivation has increased to 0.42 million hectares of land in FY’15 from 0.265 million hectares of land in FY’12. Lentil cultivation has expanded to 0.25 million hectares of land from 0.189 million hectares of land two years back. Md Ali Azam, a farmer-cum-trader at Mohammadpur in Magura district, told the FE that he has cultivated rice on only 1 ‘pakhi’ of land for their domestic consumption and cultivated summer vegetables, lentil and mashkolai (local pulses) on four pakhis this year. He said profit from pulses is 40-50 per cent higher compared to that of rice. Paddy price is still hovering around Tk 600-650 per maund in his area against a production cost of Tk 700 per maund in Aman season, he said. According to DAE, oilseed acreage was 0.395 million hectares and production was 0.764 million tonnes in FY’12 which reached 0.11 million tonnes from 0.520 million hectares of land in FY’15. Mustard comprises nearly 71 per cent of total oil crop production. Following a demand for poultry and fish feed, maize farming has also been increasing. DAE said the production target of maize is 2.4 million tonnes from 0.305 million hectares of land this FY while the total acreage has been reported at 0.32 million hectares. Feed Industries Association of Bangladesh (FIAB) data showed that demand for corn is now 2.5 million tonnes for poultry, fisheries and dairy feed industries. Government’s intervention with huge incentives, many of the farmers are now switching to cotton farming, an official at DAE said. He said 10,041 hectares of land were brought under cotton cultivation and the production target was set at 8,000 tonnes in FY12 which has increased to 27,664 tonnes from 42,000 hectares of land in FY’15. The government has taken up a Tk 1.05-billion project recently which also helped in increasing acreage of cotton cultivation, he said. He said mango, litchi and tea have been cultivated on more than 0.1 million hectares of land in last three years in the country’s northern and north-western regions.

Senior Research Fellow at local think tank Centre for Policy Dialogue Towfiqul Islam Khan told the FE that ‘opportunity cost’ of rice cultivation has been increasing which encourages farmers to switch from paddy to cash crops and other profit-making crops and fruits. Increase in ‘opportunity cost’ of rice farming means it is becoming less profitable than that of other alternatives, he said. He said farming of cash crops could bring positive changes to the socio-economic development of a farmer. “But rice production always is a strategic crop and stakeholders should keep it in mind.”

Prof Golam Hafiz Kennedy also echoed the same, adding that rice security is the key to food security of the country. The country has achieved self-sufficiency in rice production, he said. “Time-befitting export-import policy and setting of minimum support price for rice farmers are needed to keep them in cultivation of the staple crop which is inevitable for food security,” he added. Bangladesh produces 34.6 million tonnes of rice annually against its demand for 31 million tonnes, according to BBS.


Leave A Comment