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  Sri Lanka

Reference Date: 03-March-2022

FOOD SECURITY SNAPSHOT

  1. Unfavourable prospects for 2022 main cereal output due to shortages of agricultural chemicals

  2. Above‑average cereal production obtained in 2021

  3. Cereal import requirements in 2022 forecast at above five‑year average

  4. Prices of cereals and imported basic food products at high levels in February 2022

  5. Economic downturn and high food prices affect purchasing power of vulnerable households

Shortages of agricultural chemicals threaten 2022 main cereal output

Harvesting of the 2022 main “Maha” paddy crop, accounting for about 70 percent of the annual production, is ongoing and is expected to finalize at the end of March. The area planted with paddy is estimated to be close to the previous year’s above‑average level, driven by high prices and favourable weather conditions at planting time. However, shortages and high prices of agricultural chemicals resulted in their reduced application, with a negative impact on yields in most parts of the country. Therefore, there are concerns that the main “Maha” paddy production could be below average in 2022.

Similarly, the outputs of other crops such as maize, potatoes and millet, are expected to decrease compared with the average levels as a result of agricultural chemical shortages.

Above-average cereal production obtained in 2021

The 2021 cropping season finalized in September and the aggregate cereal production is estimated at 5.7 million tonnes, about 30 percent above the five-year average. Production of paddy is officially estimated at an above-average level of 5.15 million tonnes, reflecting high plantings. The output of maize is estimated at a record 496 400 tonnes, reflecting high area planted, supported by strong domestic demand, while favourable weather conditions led to bumper yields.

Cereal import requirements in 2022 forecast above five‑year average

In the 2022 calendar year, import requirements of wheat (not produced in the country) and wheat flour, account for the largest share of national cereal imports, are forecast at a near‑average level of 1.3 million tonnes. The country is almost self‑sufficient in rice and imports large quantities only when local production is not sufficient to cover the domestic needs. In calendar year 2022, imports of rice are forecast at 600 000 tonnes, the highest level since 2017, due to expectations of a reduced output in 2022 and government measures to boost imports, including the reduction of charges levied on imported rice and purchases through official channels.

Prices of cereals and imported basic food products at record highs in February 2022

Prices of rice, the country’s main staple food, surged in most markets between September 2021 and January 2022, reaching new record highs in February, about 55 percent above their year‑earlier levels. Price increases were underpinned by the depreciation of the national currency and concerns over the production of the 2022 main “Maha” crop. Similarly, prices of a wide range of imported basic food items, including wheat flour (not produced in the country), sugar, dried milk and pulses, have increased since last September and reached, in many cases, high levels in February 2022.

Economic downturn and high food prices affect purchasing power of vulnerable households

The macroeconomic situation in the country has deteriorated since 2021 mostly reflecting dwindling foreign currency reserves after revenues from merchandise exports and from the tourist sector were affected by the COVID‑19 pandemic and its containment measures. The reduction in economic activities have caused widespread loss of income and livelihoods, sharply reducing households’ purchasing power. This is of particular concern as domestic prices of basic food items have been rising since mid‑2021, seriously limiting households’ access to food.

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