Name: Nikita Tibrewal Roll No. 93 Semester: 5th Supervisor: Mr. Bhargav Majumdar Title: Problems and Prospects of Indian Rice Mills
Dissertation submitted in partial fulfilment of the requirements of the Undergraduate Degree in
BACHELOR OF BUSINESS ADMINISTRATION J.D. BIRLA INSTITUTE
AFFILIATED TO: JADAVPUR UNIVERSITY
Signature of the Student
Signature of the supervisor
To, The Controller of Examination, Jadavpur University, Kolkata.
Respected sir,
This research work has been done by me and is an original work. The references used have been mentioned in the bibliography. This research is partial fulfilment of the requirement for the BBA degree to be awarded by Jadavpur University.
Thanking you. Yours faithfully,
(NIKITA TIBREWAL)
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Abstract Rice is one of the chief grains of India. Moreover, this country has the biggest area under rice cultivation, as it is one of the principal food crops. It is in fact the dominant crop of the country. India is one of the leading producers of this crop. Rice is the basic food crop in India. The southern region of India consumes more rice and also cultivates paddy in large quantities. Rice is the end product of paddy after various production operations. In the past, the conversion of paddy to rice was a house hold job, a tasking proposition for the women folk. But due to high demand for rice the household job was transformed to mills operations. Milling is a crucial step in post-production of rice. The basic objective of a rice milling system is to remove the husk and the bran layers, and produce an edible, white rice kernel that is sufficiently milled and free of impurities. This is initially done in mills by manual operation. Due to the innovation of machineries, the new technology, has been adopting for converting paddy to rice in the name modernization. Modernization of rice mill yield more rice from it, and came with more competition between the rice mill entrepreneurs. It involve of high capital, and huge investment to start a new rice mill. Even though more rice mills were emerged in southern region of India. Many of the rice processing units are of the semi automatic type and are inefficient. Modern rice mills are having high capacity and are capital intensive, although inefficient. It is a bottleneck in its adoption by the prospective entrepreneur. So, it leads more challenges for all rice mill entrepreneurs. This paper identifies the problems which are all faced by rice mill entrepreneurs from the stage of procuring paddy till the end process of Rice. And also the rice mill entrepreneur has been obtaining some prospects from it. All frameworks for problems and prospects of rice mill entrepreneur identifies with the help review of literature and some data collected from the rice mill entrepreneur through some observation. This paper produces the findings of factors identification for constructing questionnaire to conduct survey for my research work in the topic of “A study on the Problems and Prospects of Indian Rice Mills”
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INDEX
SERIAL NO. 1.
PAGE NO.
CONTENTS INTRODUCTION
5-7
1.1 Industry Overview
5
1.2 History of Rice
6
1.3 Objective of the Project
7
2.
LITERATURE REVIEW
8-10
3.
PROBLEM STATEMENT
11
4.
RESEARCH METHODOLOGY
12-18
4.1 MEANING
12
4.2 CHARACTERISTICS
12
4.3 ASSUMPTIONS
14
4.4 MAJOR PHASES INVOLVED
14
4.5 ADVANTANGES
14
4.6 LIMITATION
16
4.7 CONCLUSION
17
4.8 SECONDARY DATA COLLECTION
18
DATA ANALYSIS
19-23
5.1 PROBLEMS
19
5.2 PROSPECTS
22
6.
FINDINGS AND CONCLUSION
24
7.
RECOMMENDATION
25
8.
LIMITATION AND FUTURE SCOPE OF STUDY
26
9.
ANNEXURE
27-29
10.
BIBLIOGRAPHY
30
5.
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1. Introduction: 1.1 Industry Overview India is one of the world's largest producers of white rice and brown rice, accounting for 20% of all world rice production. Rice is India's preeminent crop, and is the staple food of the people. It is rich in genetic diversity with thousands of varieties grown throughout the world. It is one of the chief grains of India. Today, this unique grain helps sustain two-thirds of the world's population. It is life for thousands of millions of people. About four-fifths of the world's rice are produced by small-scale farmers and are consumed locally. India is one of the leading producers of this crop. Its Production has increased from 53.6 million tons in FY 1980 to 105.00 million tonnes in 2012-2013. It is grown in almost all the provinces of the country but more than 86 percent of the total production accounts for the States of Andhra Pradesh, West Bengal, Tamil Nadu, Uttar Pradesh, Bihar, Orissa, Madhya Pradesh, Punjab and Assam. Rice production, processing and marketing constitute the biggest industry in the country. Indian rice milling industry is the oldest and largest agro-based industry. The Rice milling is a crucial step in post-production of rice. It is the process that helps in removal of hulls and bran’s from paddy grains to produce polished rice. Rice milling in India is carried out in small and medium size rice mills. Most of the small size mills are huller mills. Other various types are Battery of Huller mills, Huller-cum-Sheller mills, Sheller mills and modern mills. The by-products which we get from paddy milling are rice bran and husk. The amount of rice bran is approximately five per cent of paddy processed. The rice bran is a pericarp or outer cuticle layer that remains beneath the hull. It gets removed during the milling process. About two decades back, rice bran was considered almost a waste and hence most of it was burnt. It is now viewed to have high nutritive value. Being rich in protein and natural BVitamin, rice bran is used as a cattle feed. The rice bran processing has now gained momentum, with increasing consumer demand for bran oil, extracted from bran.
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1.2 History of rice: Many of the rice processing units in India are of the traditional huller type and are inefficient. Modern rice mills are having high capacity and are capital intensive, although efficient small modern rice mills have been developed. In the year 1968, a study was conducted by the group of officials and they pointed out that pointed out that the overall supply of rice could be augmented substantially with additional yield obtained through modernization of the existing rice processing techniques. A number of studies were also undertaken and came out with the same findings. As a result, the policy of modernization of rice mills in India has since then pursued by the Government of India and various States within it. Thus, the industry has become fairly modernized and more important in economy of the country. Thus, with higher priority being given to paddy production programmes and the changing pattern of demand for rice, the milling industry has to adopt itself to the rice milling. Most of the small size mills are huller mills. Other various types are Battery of Huller mills, Huller-cum-Sheller mills, Sheller mills and modern mills. The process for modernization of rice milling industry in the country was initiated in 1970 with a view to obtaining higher yields of rice and better quality of by-products such as bran and husk, suitable for edible oil/industrial oil extraction and as a source of fuel respectively. As a first step towards modernization, the Rice Milling Industry (Regulation) Act 1958 and the Rice Milling Industry (Regulation and Licensing) Rules 1959 were amended. In the initial phase of modernization, shellers-cum-hullers and multiple hullers were brought under purview of modernization. However, keeping in view various problems involved in the modernization of single huller mills, units existing on 27.7.1984 have been exempted from modernization. This relaxation is not available to new single huller mills set up after the date, Except to certain categories enumerated under the Act and the rules made there under. In view of the sustained efforts made by the Government, the number of Modern/modernized rice mills has gone up from practically nil in 1970 to 41, 513 in 2006-07. Also the quantity of rice bran processed for oil extraction has increased from 1.87 lakhs tones in 1970-71 to 43.50 lakhs tones in 2006-07. Traditional Method Before the advent of mechanical milling, hand-pounding traditional method of rice milling was in practice. In fact, hand-pounding rice has got more nutritive value as compared to machine milling rice. In hand-pounding, a variety of implements is used such as: • Mortor and Pestle • Dhenki 6
• Hand Stone (Chakki) Mechanical Method Two types of rice are produced by milling of paddy in the rice mills. These are:
The manufacturing of raw rice and parboiled rice from paddy involves the following major steps: Cleaning of Paddy using paddy cleaner & de stoner Parboiling of cleaned paddy in parboiling plant Mechanical Drying of parboiled paddy using steam Milling of parboiled & dried paddy using Sheller type milling machines Separation of husk using sieve cleaning of rice Polishing of rice using purling cones Separation of rice bran using sieve Separation of broken rice (broken) using sieve Weighing & Bagging of rice & by-products For production of ordinary parboiled rice, atmospheric parboiling system. For production of raw rice, the paddy after it’s cleaning and steaming is after soaking then drying is milled using Sheller. Whole rice is the main product of rice milling and rice bran, rice husk and broken rice are obtained as by-product during the process. Rice husk is the outer shell of rice and it is a fibrous material containing good amount of silica. Rice bran is a fine powder obtained during polishing of the brown rice when the outer coating on rice is removed as rice bran. It contains vegetable oil as a valuable constituent.
1.3
Objectives of the project: 1. To identify the components or driver of growth in the Indian Rice Mills. 2. To analyze to and understand the problems that the Indian Rice Mills faces. 3. To suggest viable strategies to counter such problems to boost growth in the Rice Mills. 7
2. Literature Review Status of Rice Milling Units in India: According to https://www.nabard.org/english/ricemill2.aspx Rice milling is the oldest and the largest agro processing industry of the country. At present it has a turnover of more than 25,500/- crore per annum. It processes about 85 million tonnes of paddy per year and provides staple food grain and other valuable products required by over 60% of the population. Paddy grain is milled either in raw condition or after par-boiling, mostly by single hullers of which over 82,000 are registered in the country. Apart from it there are also a large number of unregistered single hulling units in the country. A good number (60 %) of these are also linked with par-boiling units and sun drying yards. Most of the tiny hullers of about 250-300 kg/hr capacities are employed for custom milling of paddy. Apart from it double hulling units number over 2,600 units, under run disc shellers cum cone polishers numbering 5,000 units and rubber roll shellers cum friction polishers numbering over 10,000 units are also present in the country. Further over the years there has been a steady growth of improved rice mills in the country. Most of these have capacities ranging from 2 tonnes /hr to 10 tonnes/ hr.
Rice mill owners protest power tariff hike: According to http://articles.timesofindia.indiatimes.com/2002-0830/thiruvananthapuram/27318933_1_electricity-charges-power-tariff-thermalsurcharge The hike in power tariff for industries has started showing its disturbing impact. The Kerala Rice Mill Owners' Association on Friday protested against the government's decision to impose a thermal surcharge of 50 paisa per unit which came into effect from Wednesday. Addressing a press conference here, P S Abdul Nazar, its president, said at a time when the rice mill industry was facing serious problems, the hike in power 8
tariff would further aggravate the situation. The government action of increasing the electricity charges would result in a rise in the production cost and this would increase the price of rice, he said. The electricity charge increase was imposed at a time when there was shortage of paddy in the state and 50 percent of the rice mills had stopped their operations, he said. Stating that the price of rice had gone up by Rs 2 during the last two months, he said the present hike would affect the common man as the price would go up by another 50 paisa. Rice mill owners are seeking concessions in power tariff. The Salem Rice Mill Owners' Association has urged Tamil Nadu Chief Minister Jayalalithaa to provide concession in power tariff for rice mills in the State. This, the association pointed out at its General Council meeting held here on Wednesday, would give a fillip to the important industry, which was facing a plethora of problems today. The meeting also resolved that the government should abolish the marketing committees' cess on rice movement within the State and sought 25 per cent subsidy for those rice mill owners who were erecting windmills. The association also said that rice mill owners had to pay double tax – one based on horsepower under the Industries Act and another for local bodies. This system of double taxation for single use should be immediately done away with, it further demanded. The government also should allot subsidies for new rice mills under the Anna Marumalarchi scheme.
India to retain top rice exporter rank According to an article on rice industry in India India is expected to retain its top rank as rice exporter in 2012-13 marketing year on bumper production and strong export demand for Indian rice, both basmati and non basmati. India's production of rice hit an all-time high in 2011-12 crop year (period from July to June) and crossed the 100 million tonnes level. 9
India has also emerged as the world's leading exporter of rice in 2011-12 (period from October to September) and is expected to retain its top rank as rice exporter in 2012-13 due to bumper production and strong export demand for Indian rice, both basmati and non basmati, CARE Ratings said in its report here Thursday. According to the first advance estimates released by the agriculture ministry, India's kharif rice crop output is expected at 92.32 tonnes during the 2013-14 crop season, which is more or less in line with the kharif rice output of 92.76 tonnes last year. India is expected to retain its top rank as rice exporter in 2012-13 marketing year given the second-highest level of production during the 2012-13 crop year, large public stocks, liberal export policy and weak currency.
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3. Problem Statement Many Rice mills are still need to be updated about recent technology and use it for effluent treatment and utilize the by-products, such as husk, in increasing their income. Problem of achievable target set by government for production of rice in mills may lead to shutting down of many rice mills, if not revised. Data confidentiality is a key consideration for all companies. Costs and other commercial information were not needed to complete the analysis so confidentiality could be maintained. The results are not necessarily applicable to the industry as a whole. The studies analyse specific product supply chains with specific companies and processes involved. Because the analyses are specific, it is not possible to make sector-wide recommendations from the results. Many rice mills are asked to shell out more tax than their working capital which has highly affected their investment.
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4. Research Methodology The methodology used in this paper is a CASE STUDY METHOD 4.1 Meaning: The case study method is a very popular form of qualitative analysis and involves a careful and complete observation of a social unit, be that unit a person, a family, an institution, a cultural group or even the entire community. It is a method of study in depth rather than breath. The case study places more emphasis on the full analysis of a limited number of events or conditions and their inter relations. The case study deals with the processes that take place and their inter relationship. Thus, case study is essentially an intensive investigation of the particular unit under consideration. The object of the case study method is to locate the factors that account for the behaviour- patterns of the given unit as an integrated totality. According to H.Odum, “The case study method is a technique by which individual factor whether it be an institution or just an episode in the life of an individual or a group if analysed in its relationship to any other in the group”. Thus, a fairly exhaustive study of a person (as to what he does and has done, what he thinks he does and had done, and what he expects to do and says he ought to do) or group is called a life or case history. Burgess has used the words “a comprehensive study of a social unit be that unit a person, group, a social institution, a district or a community”. In brief, we can say that case study method is a form of qualitative analysis wherein complete and careful observation of an individual or a situation or an institution is done; efforts are made to study each and every aspect of the concerning unit in minute details and then from case data generalisations and inferences are drawn. 4.2 Characteristics: The important characteristics of case study method are as under: 1. Under this method the researcher can take one single social unit or more of such units for his case study purpose; he may even take a situation to study the same comprehensively.
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2. Here the selected unit is studied intensively that is, it is studied in minute details. Generally, the study extends over a long period of time to ascertain the natural history of the unit so as to obtain enough information for drawing correct inferences. 3. In the context of this method we make complete study of the social unit covering all facets. Through this method we try to understand the complexity of factors that are operative within a social unit as in integrated totality. 4. Under this method, the approach happens to be qualitative and not quantitative. Near quantitative information is not collected. Every possible effort is made to collect information concerning all aspects of life. As such, case study deepens our perception and gives us a clear insight into life. For instance, under this method we not only study how many crimes a man has done but shall peep into the factors that forced him to commit crimes when we are making a case study of a man as a criminal. The object of the study may be to suggest ways to reform the criminal. 5. In respect of the case study method an effort is made to know the mutual inter relationship of casual factors. 6. Under case study method the behaviour pattern of the concerning unit is studied directly and not by an indirect and abstract approach. 7. Case study methods results in a fruitful hypothesis along with the data which may be helpful in testing them, and thus it enables the generalised knowledge to get richer and richer. In its absence, generalised social science may get handicapped. Evolution and scope: The case study method is a widely used systematic field research technique in sociology these days. The credit for introducing this method to the field of social investigation goes to Federic Le Play who used it as a hand-maiden to statistics in his studies of family budgets. Herbert Spencer was the first to use case material in his comparative study of different cultures. Doctor William Healy resorted to this method in his study of juvenile delinquency, and considered it as a better method over and above the mere use of statistical data. Similarly, anthropologists, historians, novelists and dramatists have used this 13
method concerning problems pertaining to their areas of interests. Even management experts use case study methods for getting clues to several management problems. In brief, case study method is being used in several disciplines. Not only this, its use is increasing day by day.
4.3Assumptions: The case study method is based on several assumptions. The important assumption may be listed as following: 1. The assumption of uniformity in the basic human nature inspite of the fact that human behaviour may vary according to situations 2. The assumption of studying the natural history of the unit concern. 3. The assumption of comprehensive study of the unit concerned. 4.4 Major phases involved: Major phases involved in case study are as follows: 1. Recognition and determination of status of the phenomenon to be investigated or the unit of attention. 2. Collection of data, examination and history of the given phenomenon. 3. Diagnosis and identification of casual factors as a basis for remedial or developmental treatment. 4. Application of remedial measures, that is, treatment and therapy (this phase is often characterised as case work). 5. Follow up programme to determine effectiveness of the treatment applied. 4.5 Advantages: There are several advantages of the case study method that follow from the various characteristics outlined above. 1. Being an exhaustive study of a social unit, the case study method enables us to understand fully the behaviour pattern of the concerned unit. In the words of Charles Horton Cooley, “case study deepens our perception and 14
gives us a clearer insight into life… It gets at behaviour directly and not by an indirect and abstract approach.” 2. Through case study a researcher can obtain a real and enlightened record of personal experiences which would reveal a man’s inner strivings, tensions and motivations that drive in to action along with the forces that direct him to adopt a certain pattern of behaviour. 3. This method enables the researcher to trace out the natural history of the social unit and its relationship with the social factors and the forces involved in its surrounding environment. 4. It helps in formulating relevant hypothesis along with the data which may be helpful in testing them. Case studies, thus, enable the generalised knowledge to get richer and richer. 5. The method facilitates intensive study of social units which is generally not possible if we use either the observation method or the method of collecting information through schedules. This is the reason why case study method is being frequently used, particularly in social researches. 6. Information collected under the case study method helps a lot to the researcher in the task of constructing the appropriate questionnaire or schedule for the said task requires through knowledge of the concerning universe. 7. The researcher can use one or more of the several research methods under the case study method depending upon the prevalent circumstances. In other words, the use of different methods such as depth interviews, questionnaires, documents, study reports of individuals, letters, and the like is possible under case study method. 8. Case study method has proved beneficial in determining the nature of units to be studied along with the nature of the universe. This is the reason why at times the case study method is alternatively known as “mode of organising data “. 9. This method is a means to well understand the past of a social unit because of its emphasis of historical analysis. Besides, it is also a technique to suggest measures for improvement in the context of the present environment of the concern social units. 15
10.Case studies constitute the perfect type of sociological material as they represent a real record of personal experiences which very often escape the attention of most of the skilled researchers using other techniques. 11.Case study method enhances the experiences of the researcher and this in turn increases his analysing ability and skill. 12.This method makes possible the study of social changes. On account of the minute study of the different facets of a social unit, the researcher can well understand the social change then and now. This also facilitates the drawing of inferences and helps in maintaining the continuity of the research process. In fact, it may be considered the gateway to and at the same time the final destination of abstract knowledge. 13.Case study techniques are indispensable for therapeutic and administrative purposes. They are also of immense value in taking decisions regarding several management problems. Case data are quite useful for diagnosis, therapy and other practical case problems.
4.6 Limitations: Important limitations of the case study method may be as well highlighted: 1. Case situations are seldom comparable and as such the information gathered in case studies is often not comparable. Since the subject under case study tells history in his own words, logical concepts and units of the scientific classification have to be read into it or out of it by the investigator. 2. Read Bain doesn’t consider the case data as significant scientific data since they do not provide knowledge of the “impersonal, universal, nonethical, non-practical, repetitive aspects of phenomenon.” Real information is often not collected because the subjectivity of the researcher does enter in the collection of information in a case study. 3. The danger of false generalisation is always there in view of the fact that no set rules are followed in collection of the information and only few units are studied.
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4. It consumes more time and requires lot of expenditure. More time is needed under case study method since one study the natural history cycles of social units and that to minutely. 5. The case data are often vitiated because the subject, according to Read Bain, may write what he thinks the investigator wants and the greater the rapport, the more subjective the whole process is. 6. Case study method is based on several assumptions which may not be very realistic at times and as such the usefulness of case data is always subject to doubt. 7. Case study method can be used only in a limited sphere; it is not possible to use it in case of a big society. Sampling is also not possible under a case study method. 8. Response of the investigator is an important limitation of the Case study method. He often thinks that he has full knowledge of the unit and can himself answer about it. In case the same is not true, then consequences follow. In fact, this is more the fault of the researcher rather than that of the case method.
4.7 Conclusion: Despite the above stated limitations, we find that case studies are being under taken in several disciplines, particularly in sociology, as a toll of scientific research in view of the several advantages indicated earlier. Most of the limitations can be removed if researchers are always conscious of these and are well trained in the modern methods of collecting case data and in the scientific techniques of assembling, classifying and processing the same. Besides, case studies, in modern times, can be conducted in such a manner that the data are amenable to quantification and statistical treatment. Possibly, this is also the reason why case studies are becoming popular day by day.
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4.8 SECONDARY DATA COLLECTION: Secondary data means data that are already available i.e., they refer to the data which have already been collected and analysed by someone else. When the researcher utilises secondary data, then he has to look into various sources from where he can obtain them. In this case he is certainly not confronted with the problems that are usually associated with the collection of original data. Secondary data may either be published data or unpublished data. Usually published data are available in: a) various publications of the central, state and local governments; b) various publications of international bodies, foreign governments and their subsidiary organisations; c) technical and trade journals; d)books, magazines and newspapers; e) reports and publications of various associations connected with business and industry, banks, stock exchange etc; f)reports prepared by research scholars, universities, economists, etc. in different fields; and (g) public records and statistics, historical documents, and other sources of published information. The sources of unpublished data are many; they may be found in diaries, letters, unpublished bibliographies and autobiographies and also may be available with scholars and research workers, trade associations, labour bureaus and other public/private individuals and organisations. By way of caution, like using reliable data, suitable data and adequate data, the researcher, before using secondary data, must be seen.
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5. Data Analysis Table 1 (Refer to Annexure) From this table, we can gather a lot of important information regarding production and growth of Rice from 1960 to 2013. With the passing years the production of rice raised, however, growth rate has disorderly fluctuated every year.
5.1 Problems Case 1: Mounting pressure on rice mill owners Anna Bhagya, one of the ambitious programmes of the State government, may have come as a relief to as many as 10 million Below Poverty Line (BPL) and Anthyodaya cardholders across the State from the daily pressure of arranging for food. However, it seems to have mounted “terrible” pressure on as many as 1,818 rice mill owners in Karnataka. The rice mill owners complain that the target of levy rice to be collected from them and then distributed among Anna Bhagya beneficiaries is totally unscientific and unrealistic. The levy rice collection target set by the government for the present year is 13.53 lakh tonnes as against just 1.5 lakh tonnes in the previous year. Another issue that the mill owners are concerned about is the government may indefinitely delay payments for levy rice. “The payments are supposed to be made within 24 hours of purchase. Last year, however, it was delayed for one month, despite the fact that the amount was negligible as compared to this year’s huge target,” said Mr. Purushottam. If the target of 13.5 lakh tonnes is met, the government will have to pay Rs. 3,000 cr. at the price fixed. MINISTER’S VIEW When contacted, Minister of State for Food and Civil Supplies Dinesh Gundu Rao said: “We don’t mean to harass anybody. As per the existing procedure, 33 per cent of the hulled rice is to be collected as levy, and we will follow it. ” Result:
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The mill owners say it is impossible as they could meet only 33 per cent of the target of 1.5 lakh tonnes last year. “It is impossible to meet nine-times last year’s target this year, when we could not meet the target last year. If the government doesn’t come up with a revised, achievable target, rice mills will have no other option but to shut down,” said Konda Krishnamurthy, owner of a rice mill in Raichur. The rice mill owners allege that the government has not taken into account the increased cost of production while fixing the rates for levy rice. “The costs of labour, empty bags, electricity and other things have drastically increased in the last ten years. However, the government has not factored that while fixing the price for levy rice,” said Savitri Purushottam, a mill owner and office-bearer of the association.
Case 2: India Rice Prices Reach Record High in November 2013; Up 20% from Last Year [Table 2 (Refer to Annexure)] Average wholesale rice prices in India continue to soar, reaching around Rs. 2,931 per quintal in November 2013, up about 7% from around Rs. 2,750 per quintal in October 2013, and up about 20% from around Rs. 2,441 per quintal in November 2012. Current average wholesale rice prices are the highest since at least January 2011 and probably the highest on record, according to official sources. Harvest of the main rice crop is going on in India, but local traders say rice prices are likely to remain high in the coming months and probably surge higher later next year due to lower anticipated production and continued exports. India’s 2013-14 rice production is estimated to fall about 5% from around 105 million tons produced in 2012-13 due to the adverse impact of consecutive cyclones in October – November 2013.
Result: The Indian government extended stockholding limit for rice and paddy under the Essential Commodities Act for another year until November 2014 to prevent hoarding. However, rice exporters with government licenses are exempt from the limit until November 2014. The government said, “This [exemption] will 20
help exporters benefit from economies of scale and bigger operation for optimally meeting export demands on a long-term basis.” Maximum limit of stock for rice in India is decided by the state governments. The extension will be valid until November 30, 2014.
Case 3: 21% rice mills yet to complete shelling of last season's paddy Paddy procurement in Punjab, which started on Tuesday, is unlikely to remain smooth, at least for the next couple of days, as over 21% rice-millers in the state will not be in a position to the lift the crop bought by procurement agencies. As per the new rules prescribed for the recent paddy procurement policy of Punjab, rice shellers, who had failed to mill 80% of the total stock allocated to them during the previous season, would not be allowed to lift fresh crop, sources said. Farmers may have to bear the brunt as delay in allocation of new stock to some rice-millers will slow down the procurement operations as the entire crop lifted by government agencies is sent to rice mills for processing into rice. Officials said that Monday (September 30) was the deadline for rice shellers to complete milling of the crop allocated to them last season. "Rice mills which have failed to mill 80% of the total stock will be declared defaulters and no fresh stock will be allocated to them," said an official of the state food and civil supplies department. When asked about the number of rice mills that were yet to meet the eligibility norm of 80% milling, Tarsem Saini, president, Punjab Rice Millers Association, said that 2,500 of the total 3,200 mills have completed the process. Saini said millers would soon deliberate on further course of action and would meet the authorities to seek an extension of deadline. D S Grewal, secretary, and Satwant Singh Johal, director, food and civil supplies department, could not be contacted despite repeated attempts, for comments on government plans to tackle the issue.
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5.2 Prospects 1. Cash subsidy announced for setting up rice mills The West Bengal government Thursday announced cash subsidy for setting up rice mills in 165 blocks in the state. It will provide Rs 80 lakh for setting up a rice mill in a block in the Junglemahal area while the amount for other blocks is Rs 55 lakh, finance minister Amit Mitra said. "We are providing subsidy to set up the mills in those 165 blocks, which do not have the facility. The farmers from these blocks incur huge expenses in transporting the produce to mills in other blocks. "The subsidy is an incentive to encourage people to set up rice mills. It will also help mill owners secure bank loans," Mitra said, adding that the decision was taken in a meeting of standing committee on food processing. Ten blocks of Junglemahal have rice mills, Mitra said adding more mills can be set up depending on the viability and total paddy produce in the area. "We do not want farmers to face financial crisis or go for distress sale," he said. The state at present has 1,018 rice mills. He said the government will also set up 1,000 paddy collection camps so that "farmers do not have to bear the transportation cost of taking the produce to rice millers". "We will involve the MLAs in this work. The work for 60 new stockyards for paddy is on," said Jyotipriya Mallcik, state food minister.
2.
Bihar Govt. plans new tech for rice mills
The state industry department has decided to seek help from the Indian Institute of Crop Processing Technology, Thanjavur, to spread awareness among rice mill owners on technology in effluent treatment. At present, there are 100 rice mills in Ranchi district. Most of these do not use technology for treatment of effluents that leads to pollution. Sources in the industry department said most of the rice mills, operating in and around Ranchi, are not updated about recent technology and hence cannot use by-products to earn extra money. 22
"We want every rice mill owner to use the latest technology for effluent treatment and utilize the by-products, such as husk, in increasing their income," said state industry secretary A P Singh on Friday. Adviser to Governor Madhukar Gupta said both the Centre and the state have policies that will help in the development of food processing industry in general and rice mill industry in particular. "I hope that all the entrepreneurs will take advantage of the policies and also the available technology," said Gupta. Jharkhand Industrial Policy 2012 has made food processing industry its focus with a series of incentives and facilities for storage, which includes cold chain and godowns even in the rural areas. It also provides incentives for private industrial estate, industrial park and clusters. "The investors should come forward and take benefits from these schemes for development of food processing industry in the state," Gupta said.
3.
India ranked as top rice exporting country in the world The South Asian country surpassed Thailand and Vietnam to become the leading exporter of rice in 2012, when it sold around 10 million tonnes of the grain in the overseas market. On Friday, Indian common rice varieties were quoted at $390-$420 per tonne free-on-board, while aromatic basmati variety was quoted at around $1,515 a tonne, traders said. India produced 104 million tonnes rice in 2012/13, enough to cover demand from its around 1.2 billion population. India has been selling rice in the overseas markets without any curbs for the past three years as successive bumper harvest swelled stocks. On November 1, its rice stocks stood at 17 million tonnes, more than three times the target in the quarter to December.
4. India Winter Rice Crop Planting Area Reaches 106,000 Hectares; Up 22% from Last Year [Table 2 (refer to Annexure)] Planting area under India’s Rabi rice (winter) crop has reached around 106,000 hectares as of November 29, 2013, up about 22% from around 87,000 hectares recorded during the same time last year, according to the Ministry of Agriculture. India’s Rabi rice crop accounts for about 10 – 15% of total annual rice production in the country. India’s total Rabi planting area (including rice and other grains) stands at around 39.6 million hectares, up about 6% from around 37.5 million hectares during this time last year 23
6. Findings and conclusion: The relevant findings of the above research may be extrapolated as follows: India is the 2nd largest producer of rice after china and ranked as top rice exporting country in the world in 2012-13 with an export of 10 million tonnes and became the fiercest competitor. This astounding showing is the result of record shipments and large supplies. However, state government of Karnataka is still levying unrealistic rice collection target i.e. of 13.53 lakh tonnes on rice millers, on the basis of electricity consumed by the rice mills, causing high pressure on rice mill owners which may led to shutting down of many rice mills, which will have a very bad impact on total production and export of rice. Also, Crop damage was reported due to Cyclone Phailin in coastal Odisha and Andhra Pradesh. Market sources have estimated loss of nearly 1MT of rice due to it. Due to this the total production lowered and hence caused rise in price of rice up to 20% from last year, for few coming months. This has further led to extension of stock holding limit by Indian government. However, exemptions from government licence until November 2014 help exporters benefits economies of scale and bigger operation for optimally meeting export demands on long term basis. Again, 21% of Punjab rice millers have failed to shell last season’s rice. According to rules prescribed for the recent paddy procurement policy of Punjab, rice shellers, who had failed to mill 80% of the total stock allocated to them during the previous season, would not be allowed to lift fresh crop. It is necessary to find the reason behind the failure and work on it, as not only millers are suffering but also farmers are facing delay causing heavy loss to them. However, some state governments are doing their best to keep up the rank of our country in production and exporting of rice. West Bengal govt. is working on setting up new rice mils on 165 blocks by providing cash subsidy as an incentive to people willing to open their new rice mills.
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Bihar govt. is planning to introduce new technology to the rice millers for treatment of effluents causing pollution and utilize the by-products and increase their income. Overall in India, planting area of winter rice also increased 22% from last year and reached 106,000 hectares. Thus, the above findings are clearly indicative of the fact that the Government has a significant impact on the Rice production, Total exports, Market Size and the Gross Sown Area.
7. Recommendation There should be control in hike in price of rice, distribution and sales as the sufferer is, ultimately, common man. Also, there should be proper availability of ground water for irrigation and proper technology to ensure that the production and manufacturing processes create least amount of environmental pollution and can efficiently utilize the by-product. Record shipments and large supplies should be maintained to keep the current status of production and exports of rice mills. Rice millers should follow the rules that are necessary to keep the pace of regular shelling and allocation of stock. The Government should not regulate the operations of the industry to the extent that the mill owners, producers and manufacturers of Rice are unable to exercise their willful decisions. It should be modified time to time as per requirement.
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8. Limitation & Future scope of study Limitations: This research has faced a lot of limitations due to time, words and resource constraints. The various problems faced while preparing the project were:
The time span was limited. The data used in the given project are secondary and not primary. The project is done on macro basis. The topic is vast in nature; therefore abundance of data was available in a haphazard manner. The project is detailed in nature; hence a lot of extensive research had to be done. By overcoming the above limitations I would be able to deliver a much better project.
Future scope of study: As per the data, we can see that the production and growth of rice is playing significant role in country’s development. Being at the top of all rice exporting countries, India is getting a lot benefit of foreign exchange and therefore, the govt. is encouraging the new entrepreneurs willing to start their own rice mills. Also, two new hybrid rice varieties are being developed and new genes of rice are being discovered by the Researchers which are expected to boost the rice yields and create a new market for the same. Again, Central Rice Research Institute (CRRI), cuttack has prepared a document “Vision-2050”, based on the assessment of present situation, trends in various factors and changes in operating environment around agriculture to visualize the agricultural scenario about 40 years hence and chalk out demand-driven research agenda for science-led development of agriculture for food, nutrition, livelihood and environment security, with a human touch.
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9. Annexure Table 1: India Milled Rice Production by Year
Market Year Production Unit of Measure Growth Rate 1960
34639
(1000 MT)
NA
1961
35663
(1000 MT)
2.96 %
1962
33217
(1000 MT)
-6.86 %
1963
36998
(1000 MT)
11.38 %
1964
39308
(1000 MT)
6.24 %
1965
30589
(1000 MT)
-22.18 %
1966
30438
(1000 MT)
-0.49 %
1967
37612
(1000 MT)
23.57 %
1968
39761
(1000 MT)
5.71 %
1969
40430
(1000 MT)
1.68 %
1970
42225
(1000 MT)
4.44 %
1971
43068
(1000 MT)
2.00 %
1972
39245
(1000 MT)
-8.88 %
1973
44051
(1000 MT)
12.25 %
1974
39579
(1000 MT)
-10.15 %
1975
48740
(1000 MT)
23.15 %
1976
41917
(1000 MT)
-14.00 %
1977
52617
(1000 MT)
25.53 %
1978
53773
(1000 MT)
2.20 %
1979
42330
(1000 MT)
-21.28 %
1980
53631
(1000 MT)
26.70 %
1981
53248
(1000 MT)
-0.71 %
1982
47116
(1000 MT)
-11.52 %
1983
60097
(1000 MT)
27.55 %
1984
58337
(1000 MT)
-2.93 %
1985
63825
(1000 MT)
9.41 %
1986
60416
(1000 MT)
-5.34 %
1987
56862
(1000 MT)
-5.88 %
1988
70489
(1000 MT)
23.97 %
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1989
73573
(1000 MT)
4.38 %
1990
74291
(1000 MT)
0.98 %
1991
74680
(1000 MT)
0.52 %
1992
72868
(1000 MT)
-2.43 %
1993
80300
(1000 MT)
10.20 %
1994
81810
(1000 MT)
1.88 %
1995
76980
(1000 MT)
-5.90 %
1996
81730
(1000 MT)
6.17 %
1997
82540
(1000 MT)
0.99 %
1998
86080
(1000 MT)
4.29 %
1999
89680
(1000 MT)
4.18 %
2000
84980
(1000 MT)
-5.24 %
2001
93340
(1000 MT)
9.84 %
2002
71820
(1000 MT)
-23.06 %
2003
88530
(1000 MT)
23.27 %
2004
83130
(1000 MT)
-6.10 %
2005
91790
(1000 MT)
10.42 %
2006
93350
(1000 MT)
1.70 %
2007
96690
(1000 MT)
3.58 %
2008
99180
(1000 MT)
2.58 %
2009
89090
(1000 MT)
-10.17 %
2010
95980
(1000 MT)
7.73 %
2011
105310
(1000 MT)
9.72 %
2012
104400
(1000 MT)
-0.86 %
2013
105000
(1000 MT)
0.57 %
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Table 2: Indian average monthly price of rice
Table 3: India Winter Rice Crop Planting Progress
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10. Bibliography & Reference Data Base: www.indexmundi.com www.oryza.com
Websites:
www.wikipedia.com www.google.com www.nabard.org www.rkmp.co.in www.knowledgebank.irri.com www.ricenews.net www.scribd.com www.crri.nic.in
WebPages:
http://timesofindia.indiatimes.com/topic/Rice-mill/news/ http://www.indianexpress.com/gsearch.php?q=rice+mills&x=1124&y=-62&mod=dsearch&onSubmit=Submit http://www.thehindubusinessline.com/industry-and-economy/agribiz/sops-for-private-sector-in-bengal-to-set-up-rice-mill-in-everyblock/article5330385.ece http://articles.timesofindia.indiatimes.com/keyword/rice-mill http://www.thehindu.com/news/national/karnataka/mountingpressure-on-rice-mill-owners/article5248700.ece http://www.slideshare.net/shivade/rice-mill20304764?from_search=1 http://www.vanguardngr.com/2013/01/rice-mill-importationshould-be-done-by-private-sector-lcci/ 30
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