Cereal import bill hits record high despite bumper harvestsNepal’s cereal import bill hit a new record high in the third quarter despite recording the largest paddy and wheat harvest in history. Based on current trends, the total bill for this fiscal year ending mid-July is expected to exceed Rs50 billion.
Nepal’s cereal import bill hit a new record high in the third quarter despite recording the largest paddy and wheat harvest in history. Based on current trends, the total bill for this fiscal year ending mid-July is expected to exceed Rs50 billion.
The revelation set off alarm bells that Nepal was rapidly becoming dependent on imported foods despite pouring billions into the agriculture sector annually, mainly on subsidising fertiliser.
According to the Department of Customs, Nepal imported rice, paddy, maize and wheat worth Rs40.21 billion in the first nine months of 2018-19, up 23.10 percent year-on-year. The top contributors are rice and maize. Rice imports hit 384,956 tonnes valued at Rs19.32 billion. The country imported 201,620 tonnes of paddy worth Rs5.60 billion and 302,382 tonnes of maize worth Rs8.72 billion.
Analysts say the steep rise in cereal imports is largely due to soaring demand for fine rice and maize used as animal feed. Cereal imports have swelled when harvests of key food grains are projected to reach all-time highs this fiscal year.
Nepal’s paddy harvest hit a record high of 5.61 million tonnes this fiscal year, according to the Ministry of Agricultural Development. The bumper crop is a 9 percent increase from the previous year, ministry officials said.
Similarly, Nepal’s wheat harvest has been projected to exceed 2 million tonnes, up 7 percent this fiscal year and set a new record. The all-time high wheat crop follows a bumper paddy harvest last summer. Wheat is the country’s third most common cereal crop after paddy and maize.
The statistics show that among imported farm products, vegetable imports are growing at a faster rate. Vegetable imports jumped 32.38 percent to Rs22.48 billion in the review period.
Ram Krishna Regmi, chief statistician at the Agriculture Ministry, said that Nepal produces small quantities of fine rice like basmati and imports are used to fill the supply gap. Due to the high value of fine rice, the import bill is also high although the quantity has not increased significantly, Regmi added.
According to Regmi, an expanding poultry industry has been driving up maize imports. “These two food grains—rice and maize—are the key contributors to ballooning cereal imports.”
Imports are swelling each passing year which shows that the government’s strategy to boost output has failed, said analysts. In 2015, the government unveiled plans to bring down the country’s rice import bill from Rs14 billion in 2014-15 to Rs6 billion in 2015-16 and then Rs2 billion in 2016-17.
It created an ambitious plan to export paddy worth Rs3 billion by 2017-18. But in an absurd turn of events, the cereal import bills have been increasing out of control.
According to Regmi, commercial vegetable farming has boomed in the country, but they don’t know the reason behind the sharp rise in imports. Customs Department statistics show that Nepal imported 125,647 tonnes of onion worth Rs3.96 billion in the first nine months of the current fiscal year. In the same period, potato imports amounted to 223,667 tonnes worth Rs4.76 billion.