A significant agreement has been forged between the Kerala State government and rice mill owners, ensuring the uninterrupted procurement and storage of paddy. This resolution emerged from a crucial meeting on Wednesday, presided over by Chief Minister Pinarayi Vijayan.
The primary agenda of the meeting revolved around the mill owners’ persistent demand to adjust the out-turn ratio (OTR) for common rice. While the Central government mandates an OTR of 68% (meaning 68 kilograms of rice from every quintal of paddy), the mill owners have advocated for a reduction to 64.5%, citing reduced productivity largely due to adverse climatic conditions.
High Court Ruling
Despite the State government’s initial support for this revision, the Kerala High Court previously ruled that the State lacks the jurisdiction to modify a ratio already established by the central authority.
Nevertheless, Chief Minister Vijayan announced a significant step forward: the Cabinet will consider approving a compensation package of ₹63.37 crore for rice mill owners. This amount is intended to offset the financial losses they faced during the 2022-23 procurement year, specifically those stemming from adherence to the Centre’s fixed OTR.
Mr. Vijayan reiterated that while the State cannot unilaterally alter the prescribed OTR, Kerala faces unique practical challenges in meeting national standards due to its distinctive climatic and agricultural environment. Consequently, the State government plans to formally request the Centre to revise the ratio to better align with local realities. Furthermore, starting from the 2025-26 harvest season, the State government committed to directly compensate mill owners for any future losses incurred due to OTR variations.
Transportation Charge
In addition to the OTR discussions, the State has also submitted a request to the Central government for sanctioning transportation charges related to paddy movement. Should this request be approved, the full amount of these charges will be directly passed on to the rice mill owners.
The meeting saw the attendance of several key ministers and senior officials, including Food and Civil Supplies Minister G.R. Anil, Finance Minister K.N. Balagopal, Cooperation Minister V.N. Vasavan, Electricity Minister K. Krishnankutty, and Agriculture Minister P. Prasad.