RICE: Economic Boom or Bust? Part XXVI

Bojoon.com and CIC has teamed up to review one of the most controversial debates of Sri Lanka - is rice as an industry worth the effort.

Large, well established agribusinesses that have a large research capacity may be in a better position to offer a viable solution to the problem of manpower shortage. Whether the agribusiness can bridge the landowner with the farming hand depends largely on the social penetration of that agribusiness.

A more feasible solution agribusiness can offer is providing better technology so that the landowner can cultivate his land with minimum help.

However, because of the minuses of hybridization such as crop contamination and seed dependency where the farmer always has to procure the seeds from the agribusiness for each and every season and because of the power of established businesses - especially multinational companies - to strong arm the smaller entity partnerships such as these are generally viewed with distrust.

Mainly in developing countries multinational companies tend to wield more pressure power than the country’s own government in the international arena. This distrust is further cemented with global examples such as the American ‘green revolution’.

Thus, when similar projects were introduced to Africa, many activists were worried of parallel consequences where the farmer gains little whilst the larger entity pockets the profits. However, the main dissimilarities between the American and African scenarios are that in Africa the country infrastructure is not developed and thus especially the road network system is in poor condition, making accessibility between the farming community and the larger corporate business entities difficult.

Hence, getting the end agricultural product to the end consumer is made an arduous task, costing more and accruing more food miles and thereby making this more or less a profitless venture.

In addition, countries like Africa are unstable politically as well as due to various militant factors. This especially makes the country unattractive for foreign business investors to venture. Therefore, there is higher percentage of success for projects between agribusinesses and single or small entities, where the smaller farming communities are more likely to develop.

The farming communities would still be dependent on the agribusiness for its seeds and if the farmer wants to grow that particular crop, then in all likelihood he will have to maintain his partnership with the agribusiness. Another minus point is that if the crop is contaminated, then the farmer will have to bear the brunt of it.

These are the issues of these types of projects, which State bodies such as State sponsored research units can intervene and if not remove the negative issues then at least to reduce its effects.

The State bodies are however unable to match the pluses of projects like these such as create new markets, penetrate existing markets such as the lucrative export markets and boost product images to the successful extent of an agribusiness.

Join Daily News next week as bojoon.com unravels with CIC many mysteries and misinterpretations surrounding rice cultivation in Sri Lanka. Share your own opinion by sending an email to [email protected].