ACHIEVING BORO RICE PRODUCTION TARGETS IN FY2009-10 Challenges and Actions Required Report No. 102 Publisher Centre for Policy Dialogue (CPD) House 40/C, Road 11 (New), Dhanmondi R/A Dhaka 1209, Bangladesh Telephone: (8802) 8124770, 9141703, 9141734, 9145090 Fax: (8802) 8130951 E-mail: [email protected] Website: www.cpd.org.bd http://www.cpd.org.bd/Blog/ First Published April 2011 © Centre for Policy Dialogue Disclaimer: The contents of this report do not necessarily reflect the views of CPD and any other organisation(s) with which the dialogue participants are involved. Tk. 30 USD 5 ISSN 1818-1538 C52011_1DR102_ARD The Centre for Policy Dialogue (CPD), established in 1993, is a civil society initiative to promote an ongoing dialogue between the principal partners in the decision making and implementing process. The dialogues are designed to address important policy issues and to seek constructive solutions to these problems. Over the past years, CPD has organised a series of such dialogues at local, regional and national levels. CPD has also organised a number of South Asian bilateral and regional dialogues as well as international dialogues to pursue for the LDC interests in various fora including WTO, UN and other multilateral organisations. These dialogues have brought together ministers, opposition frontbenchers, MPs, business leaders, NGOs, donors, professionals and other functional groups in the civil society within a non-confrontational environment to promote focused discussions. CPD seeks to create a national policy consciousness where members of civil society will be made aware of critical policy issues affecting their lives and will come together in support of particular policy agendas which they feel are conducive to the well-being of the country. In support of the dialogue process the Centre is engaged in research programmes which are both serviced by and are intended to serve as inputs for particular dialogues organised by the Centre throughout the year. Some of the major research programmes of the CPD include Macroeconomic Performance Analysis; Poverty, Inequality and Social Justice; Agriculture and Rural Development; Trade, Regional Cooperation and Global Integration; Investment Promotion, Infrastructure and Enterprise Development; Climate Change and Environment; Human Development and Social Protection; and Development Governance, Policies and Institutions. CPD also conducts periodic public perception surveys on policy issues and issues of developmental concerns. With a view to promote vision and policy awareness amongst the young people of the country, CPD is also implementing a Youth Leadership Programme. Dissemination of information and knowledge on critical developmental issues continues to remain an important component of CPD’s activities. Pursuant to this CPD maintains an active publication programme, both in Bangla and in English. As part of CPD's publication activities, a CPD Dialogue Report Series is brought out in order to widely disseminate the summary of the discussions organised by the Centre. The present report contains the highlights of the dialogue on Achieving Boro Rice Production Targets in FY2009-10: Challenges and Actions Required held on 23 December 2009 at the CIRDAP Auditorium, Dhaka. Prepared by: Muhammad Al Amin, Senior Research Associate, CPD. Assistant Editor: Anisatul Fatema Yousuf, Director, Dialogue & Communication, CPD. Series Editor: Professor Rehman Sobhan, Chairman, CPD. THE DIALOGUE The dialogue on Achieving Boro Rice Production Tragets in FY2009-10: Challenges and Actions Required, organised by the Centre for Policy Dialogue (CPD), was held on 23 December 2009 at the CIRDAP Auditorium, Dhaka. The main objective of this dialogue was to share the findings of a study carried out by CPD on the above mentioned subject, keeping in view the upcoming Boro season, present the policy suggestions generated from the analysis, and hold a discussion with the relevant stakeholders. Professor Rehman Sobhan, Chairman, CPD presided over the session while Dr Uttam Deb, Head of Research, CPD presented the keynote paper. Begum Matia Chowdhury, MP, Hon'ble Minister for Agriculture attended the meeting as the Chief Guest; and Mr Mirza Fakhrul Islam Alamgir, Former State Minister for the Ministry of Agriculture (MoA) was present as the Special Guest. The dialogue was participated by academia, senior government officials and policymakers, experts on agriculture, researchers of various government and non-government organisations (NGOs), representatives of development agencies, journalists, political leaders and representatives from farmers' association. The list of participants is attached at the end of the report. THE KEYNOTE PAPER Dr Uttam Deb, in his presentation, covered the following five broad areas: i) recent developments in global and domestic food situation; ii) reality check for Boro production target in FY2009-10; iii) input delivery strategy to ensure higher Boro production; iv) procurement strategy; and v) policy implications. Dr Deb initiated his presentation by describing the recent structural changes that have taken place in rice production in Bangladesh. He stated that dependence for food security has been shifted from Aman to Boro rice which is now about half of the total rice production in Bangladesh. This structural change in rice production and more dependence on Boro season has made rice production a function of input supply, prices and policies rather than vagaries of nature, he added. Recent Developments in Global and Domestic Food Situation While clarifying the recent developments in global and domestic food situation, Dr Deb cited some facts and figures published recently in various reports, journals, and newspapers. He mentioned that according to the USDA Rice Outlook (11 December 2009), global rice production in 2009-10 will decline by 3 per cent and production will be 433.9 million metric tonnes (MT). Adding example from India, he said that the production of Kharif rice in India will be 69.45 million MT in 2009-10 against 84.58 million MT in 2008-09 (18 per cent decline) as per the estimation by the Department of Agriculture and Cooperation of India. Dr Deb sketched recent movement of the key rice traders around the globe to explain the rice market situation in international arena. He stated that the rice import demand would CPD Dialogue Report 102 rise in the coming year as major importers such as India, Philippines and Brazil have already declared to import more. Dr Deb expressed his concern that if there is any production shortfall in Bangladesh, then it might be difficult to import from the international market. While explaining the international rice price situation, Dr Deb made a comparison of rice prices among Bangladesh, India and Thailand which revealed that since July 2006 rice price in Bangladesh was lower than that of Thailand and India with a few exceptions. In this backdrop, Dr Deb opined that even if Bangladesh needs to import from the international market, it would be at a higher cost than current domestic price. Feeding her own population at a lower cost would only be possible by attaining self-sufficiency in rice production, he added. Dr Deb then described the domestic food situation, and focused on domestic production. He highlighted that in FY2008-09, total production of foodgrains (rice and wheat) was 32.2 million MT, which is the highest production in Bangladesh’s history. He mentioned, it was due to good harvest of rice (Aus, Aman and Boro) and wheat in all seasons. Government’s decision to reduce price of non-urea fertiliser and smooth supply of electricity to irrigation pumps along with expectation of good profit by the farmers also contributed to high level of production in FY2008-09. However, Dr Deb pointed out that the low price of paddy at the farm-level during May-July had a negative toll on the production of Aus rice and probably also on Aman rice in FY2009-10. He informed that planting of Aman was delayed and it was affected by lower rainfalls and early droughts. Therefore, he apprehended a lower Aman production in the current season. The presenter informed the audience that price of rice is an important determinant of food inflation in Bangladesh which contributes 42 per cent share of the total food inflation, and the recent rise in the domestic prices is actually already reflected in the food inflation curve. It also affects the food import situation of the country. In this context, Dr Deb mentioned that during 1 July-15 December, 2009 no commercial import of rice by public and private sector had taken place in Bangladesh due to lower domestic price. Reality Check for Boro Production Target in FY2009-10 Dr Deb attempted to check the rationality of Boro production target set by the Department of Agricultural Extension (DAE) in FY2009-10. He reported that the MoA set a target of cultivating Boro rice in 48 lakh hectares (ha) of land in FY2009-10. He added that the target for Boro area in FY2009-10 is 1.8 per cent higher than actual Boro area in FY2008-09, and the target for Boro production is 6.7 per cent (19 million tonnes) higher than actual production in FY2008-09. To examine the reality of this target, Dr Deb presented historical evidence of Boro rice targets and achievements. He informed that during FY1980-81 to FY2008-09, the area under Boro rice cultivation increased from 1.16 million ha to 4.72 million ha, while the production of Boro rice increased from 2.63 million tonnes to 17.8 million tonnes and per hector yield of Boro increased from 2.27 ton/ha to 3.78 ton/ha. He also mentioned that during this period, annual compound rate of growth in area, production and yield of Boro rice was 4.75, 6.48 and 1.73 per cent respectively. Page | 2 Achieving Boro Rice Production Targets in FY2009-10 Input Delivery Strategy to Ensure Higher Boro Production Dr Deb presented the current input delivery situation of Boro production and suggested a number of strategies which would be required to ensure a good Boro harvest in FY2009-10.