Saturday, October 1, 2022

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Organic fertilizer blunder continues to send shock waves through agriculture sector

The disastrous organic fertilizer blunder of previous Gotabaya Rajapaksa regime , which came to a head in the second quarter of this year, plunged Sri Lanka’s agriculture sector to an unprecedented decline, creating a massive food crisis in the country.

Some trace his downfall back to an ill-fated decision in April 2021 to stop all imports of chemical fertilizers and abruptly put the country on a path to organic agriculture.

One analyst wrote that “Mr. Rajapaksa’s imperious decision to impose organic farming on the entire country … led to widespread hunger after the agricultural economy collapsed.”

The reality is that this policy had everything to do with foreign currency shortages and an inability to pay for imports rather than a planned shift to organic agriculture. As such, the former president’s hasty call for an organic transition was a convenient excuse to stop paying for fertilizer imports.

While former president Rajapaksa abandoned his ban on chemical fertilizer imports at the end of 2021, supplies are still erratic and only available to wealthier farmers as the underlying problem of a lack of foreign exchange reserves remains a problem.

The agriculture sector, which first contracted by 2.8 percent in the third quarter last year, continued to deepen its decline to 3.1 percent in the final quarter in 2021 and 6.8 percent in the first quarter in 2022, before shedding as much as 8.4 percent in the most recent quarter ended in June from a year ago.

The government made an embarrassing acknowledgement of its policy blunder and made a U-turn in November last year to restore chemical fertilizer supply.

However, it never returned to its former levels of supply and instead ran into severe shortages of fertilizer from the beginning of the year, due to the crippling dollar shortage and soaring prices of fertilizer, exacerbated by the Russia-Ukraine war.

As of late, the government has managed to ensure continuous supply of fertilizer by way of donor funding and prioritizing the limited foreign currency spending into fertilizer to ensure that the country averts a severe food shortage.

Releasing the second quarter GDP data, the Census and Statistics Department said the deeper agricultural sector decline was led by the 32.3 percent contraction in cereals, 19.7 percent decline in tea, 15.6 percent slump in paddy, 15.3 percent fall in marine fishing, 13.7 percent slide in rubber and 13.6 percent and 13.2 percent plunges in animal production and vegetables, respectively.

However, the fresh water fishing, plant propagation and agriculture supporting activities, growing of oleaginous fruits, including coconut, forestry and logging, perennial crops and spices expanded during the quarter under review from a year earlier

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