Profitability of rice farmers increases 73% in 4 years

Profitability of farmers growing rice in West Bengal, Punjab, Haryana, Uttar Pradesh, Bihar, Chhattisgarh, Andhra Pradesh, Telangana and Karnataka increased to an average of 26,000 euros per acre from 15,000 euros (or 73 per cent) over the past four years, according to for a market research firm.

There are two main factors that support the increase in profits. One is better yield and the other is buying a higher crop (at the lowest support price), said Priyanka Mallick, CEO of Q&Q Research Insights.

the government rice Purchases hit a record high of 60.25 million tons (metric tons) in 2020-21 (Oct-September), accounting for nearly half of production. MSP in which rice is purchased increased by more than 16 percent to ₹2,040/quintal in 2022-23 from ₹1,750/quintal in 2018-19.

The study covers 3,800 farmers in major rice growing areas in all of those nine states and was conducted in the fall season from 2019 to 2022. The average land holding of the farmers who participated in the survey was 6 acres.

rice crop

According to Q&Q Research, average rice production has increased by 16 percent in the past three years from 19.3 quintals per acre to 22.4 quintals per acre.

However, labor remains a major pain point for the farmer, Malik said Business line Adding that there has been a 25 percent increase in labor costs in the past four years. “Labor costs have risen significantly in four states – Karnataka, West Bengal, Punjab and Bihar. Farmers are looking for better technology like drones and more effective insecticides to reduce spraying.”

Pest management

Mukta Sirohi, chief operating officer of Q&Q Research, said that even as rice farmers become more profitable, farmers still worry about managing pests and diseases in most parts of the country.

She said that 60 percent of the farmers surveyed said that local retailers are the most influential in their decision-making to purchase any agricultural inputs. “This is very much true for pest management and the crop protection brands they have to use,” said Serohi. Apart from retailers, peers or fellow farmers are the other influencers.

“Retailers prefer brand endorsements, and they are often governed by the margins offered by companies,” said Megha Joshi, vice president at the company.

Malik said farmers are also interested in direct seed rice (which does not require planting) and switching to less labor-intensive crops. DSR has gained traction in traditional farming markets like Punjab, Haryana, Ube and Telangana. However, weed management must be addressed by agricultural input companies to increase its adoption, she said.