The implementation of the guaranteed price scheme proposed through the last budget commenced on March 28. Accordingly, guaranteed prices were established for potatoes, big onions and dry chili.
It is established the guaranteed producer price of 1 kg of potato as Rs. 80/-, the guaranteed producer price of 1 kg of big onion as Rs. 60/-, and the guaranteed produce price of 1 kg of dry chili as Rs. 350/- under the scheme.
The guaranteed produce price of 1 kg of seed potato has been priced as Rs. 160/- and the guaranteed produce price of 1 kg Big Onion seed as Rs. 12,000/-. This step has been taken to encourage the seed producers.
With the target of 10 percent growth in the agriculture sector, the Government aims at achieving national food security, ensuring a reasonable price for agricultural products and creating an uninterrupted access to competitive markets both in Sri Lanka and abroad for value added agricultural products.
About 25,000 farmers are engaged in potato cultivation in the Nuwara Eliya and Badulla Districts. The livelihood of 250,000 people depends directly and indirectly on potato cultivation although the country still produces only 40 percent of its potato requirement which is about 12,000 metric tons per month. Sixty-five percent of local potatoes are grown in the Badulla District and the harvest is sent to the market in February and March. Potatoes grown in the Nuwara Eliya District reach the market in May.
Although Sri Lankans consumed 200,000 metric tons of big onions per year only 87,660 are produced resulting in the country having to spend Rs.6000 million in foreign exchange on big onion imports. However local farmers are supplying 93 percent of the country’s red onion requirements.
Considering these facts, Government anticipates to reach a 50 percent self sufficiency in potato, big onion and dry chili production by 2015 targeting to transfer from a net food importing economy to a net food exporting economy. Accordingly, the actions were taken by the Government to be given reasonable price for agricultural production by introducing guaranteed price for the crops of potato, big onion and dry chili.