You are here
Home > Article > Lack of finance prevents farmers from diversifying rice crops

Lack of finance prevents farmers from diversifying rice crops

Bangladesh is home to more than 130 different rice varieties, but a lack of economic incentives means farmers here grow only a handful of the higher-yielding types. This has given rise to a virtual monocrop system, which farmers and experts say threatens both long-run production and soil quality.

Most farmers, meanwhile, blame a vicious cycle of dependence on high interest micro-credit for agro-input, which leaves them overdependent on high yield varieties, and little room to experiment with other varieties.

Abdur Razzak,a 48-year-old farmer in the northern district of Dinajpur, has for the past 15 years grown the most popular varieties — known as BRRI-28 and BRRI-29 — which yield around 6 metric tons of rice per hectare of land, or about 2.7 short tons per acre.

“A couple of years back we tried BRRI-35,” he says. “[We] dropped it the next year as it yielded only about 3 [metric] tons per hectare,” or 1.3 short tons an acre. Making matters worse, the market price of BRRI-35 and other lesser-known varieties is lower than that of the popular varieties because of the lack of demand.

Like Razzak, some 15 million farmers in Bangladesh depend just on five to six rice varieties in an effort to maximize their output, cultivating them on 8.6 million hectares (21.3 million acres) of land. That’s made Bangladesh the fourth-highest rice-producing country in the world, churning out 36 million metric tons of rice annually to feed its 170 million people.

Other popular varieties are BRRI-58, 50, 63 and 74, all named after the Bangladesh Rice Research Institute that developed them. But it’s BRRI-28 and 29 that dominate, accounting for around 50% of all the rice grown in the country, because of their better yields and market price.

Both farmers and researchers say the return on investment is the main reason for this practice, which has given rise to an effective monoculture. The high cost of production — ranging from irrigation and labor to fertilizers and pesticides — as well uncompetitive prices mean farmers have no incentive to explore beyond the dominant varieties.

Lack of access to affordable financing

In a country where agriculture is a mainstay of the economy and farmers play the chief role in ensuring food security, farmers have little formal access to low-cost financing for their operational needs.

Generally, there are three sources of financial support available to Bangladeshi farmers. First, there are dadon, local lenders who charge exorbitant interest rates on loans that must be paid back in weekly installments. Then there are nongovernmental organizations that provide microcredit loans, followed by state-owned banks.

Although the latter, with their lower interest rates, would be the ideal option for farmers, most shy away from banks because of the convoluted bureaucracy. The government established the Bangladesh Krishi Bank in 1973 with the aim of supporting farmers, but even today it hasn’t gained much traction.

“Unfortunately, bureaucratic tangles, involvement of third parties in the loan disbursement process, and political intervention has made the bank ineffective,” said Fazle Rabbi Sadeque Ahmed, deputy managing director of the Palli Karma-Sahayak Foundation (PKSF).

Between the dadon and the NGOs, farmers tend toward the latter. But even here, the loans aren’t cheap: the average annual interest rate is 31%.

“We are forced to sell the paddy at a low price immediately after harvest to repay our loans,” said Dilip Kumar, a 40-year-old farmer from another northern district, Lalmonirhat. “If we wait to sell it, the interest on our loan will go up.”

Risks of monocrop culture

“If farmers cannot get a fair price for their produce and cannot access finance to meet their [production] needs on time, they will definitely go for varieties that have the best yield,” said Ahsan Uddin Ahmed, a researcher on environment and climate change issues.

He said that makes the predominance of monoculture the fault of the government, as it has failed to address the farmers’ interests by making it feasible for them to explore other rice varieties.

A 2019 study suggested that adopting alternative varieties of rice could help Bangladeshi farmers avoid risks such as pest attacks and low yields in the long run — risks that grow the greater the overdependence on a few varieties.

Repeated monocropping also degrades soil health, which Ahsan Uddin, who is a member of the Green Climate Fund’s Independent Technical Advisory Panel of the Green Climate Fund, also blamed on the government.

“The farmers are not liable for the damage to soil health. It’s the state’s responsibility to ensure availability of technology, finance and cultivable varieties. The government has failed in this regard,” he said.

“The government should introduce a mechanism so that farmers get a fair price for their production,” said  Jibon Krisna Biswas, a former director-general of the BRRI. “Otherwise, they will continue to grow varieties like BRRI-28 and BRRI-29. This is leading to the monocrop culture, which will bring ecological ruin in the long run.”

(This article is republished from Mongabay under Creative Commons License)

Abu Siddique is Mongabay’s Contributing Editor for Bangladesh. He has worked for several of the leading national dailies including Dhaka Tribune, Daily Sun and The Business Standard, and has explored the remotest corners of the country in search of stories.

Similar Articles

Leave a Reply

Top