Low cereal production to hit economic growth rate, food prices to go up

Erratic rainfall and government’s inability to provide fertilizer to the farmers on time has not only pulled cereal crops production down but also inflict a loss of around Rs 12 billion on economy coupled with hike in food prices that will increase number of poverty head count.
This year the production totalled 6.81 metric tonnes (MT) — some by 9.9 per cent less compared to last year’s 7.57 million MT, according to Ministry of Agriculture Development.
All the major cereal crops — rice, maize and millet except buckwheat — production this year witnessed a drop, joint secretary at the ministry Dr Prabhakar Pathak said, adding that cereal crops production has dropped however the country will not witness food shortage.
"We have about 800,000 MT surplus cereal grains from last year's production," he said, adding that low population growth in the last decade also helped sufficient food grains to feed all.
"We need about 5.2 million MT cereal crops to feed about 26.49 million population,” Pathak added. "But, we have 6.8 million MT apart from winter crops."
There will not be any food deficit situation if we could manage proper supply chain, he added.
Twenty-three districts of mid-and far-western region have been facing food shortage during summer every year as the government has been failing to manage supply chain properly. The districts — all districts of Karnali zone and hill districts of Seti, Bheri and Rapti zones — are the low crop producing districts.
According to the ministry, the country produced around 4.50 million MT rice, some 1.99 million MT maize, some 305,588 MT millet and some 10,056 MT buckwheat, respectively in the current fiscal year. The figures revealed that only buckwheat production has increased by 35 MT, but overall cereal production has dropped by about 757,594 MT.
Productivity of major cereal crop, rice, has decreased from 3.31 MT per hector to 3.17 MT per hector. Similarly, maize production has witnessed a sharp fall of 148 kg in a hector from 2.5 MT per hector, whereas millet productivity is just 1.11 MT in a hector.
However, the ministry is satisfied that the production did not fall to the expected level. "Irregular monsoon and fertilizer shortage could not hit the crops hard,” Pathak said, adding that per hector chemical fertilizer use stood at around 47 kg in paddy this year.
The drop in production and disrupted supply chain will however, push the food price up in the domestic market.

According to the World Bank Food Price Watch too, despite price decline in October, international food prices remain close to all-time highs.

"Globally maize markets remain tight, despite the moderately good news that has somewhat eased the international price of maize during the last three months," the Price Watch reported, adding that increasing concerns on wheat production maintained its firm international prices, which were on the rise in the last quarter, whereas recent rice export prices reflect a mixed performance based on origin. "Effects of the unfolding weather will determine immediate price trends to a large degree."

The decreasing trend
Food stuff —2011-12 — 2012-13
Rice — 5.07million MT — 4.50 million MT
Maize — 2.17 million MT — 1.99 million MT
Millet — 315,067MT— 305,588MT
Buckwheat— 10,021MT — 10,056MT
(Source: Ministry of Agriculture Development)