Keralam sanctions Rs 63.37 crore to clear paddy procurement liability

Thiruvananthapuram: The Keralam government has sanctioned Rs 63.37 crore to clear Supplyco's financial liability arising from paddy procurement during the 2022-23 season, the state Food and Civil Supplies Minister Anoop Jacob has said.

The minister said the amount had been allocated from the state budget to compensate mill owners who processed paddy procured through Supplyco, the state Civil Supplies Corporation, during the period.

The liability arose from the Centre's refusal to reduce the out-turn ratio (OTR) for rice recovery from 68 per cent to 64.5 per cent, as demanded by mill owners, he said in a statement.


Under the central norms, rice mills are required to recover 68 kg of rice from every quintal (100 kg) of paddy. However, mill owners have argued that the special characteristics of paddy grown in Keralam, particularly in the Kuttanad region, make it difficult to achieve the stipulated recovery rate.

The dispute dates back to September 2017, when mill owners refused to procure paddy on time, citing their inability to achieve the prescribed 68 per cent recovery rate.

In 2018, the state government issued an order agreeing to bear the financial burden arising from the difference in the out-turn ratio until the Centre reduced the prescribed rate from 68 per cent to 64.5 per cent, he said.

The state would again urge the central government to revise the out-turn ratio, taking into account Keralam's special circumstances, Jacob said.

The government has also decided to appoint a committee to study the losses arising from the difference in the recovery ratio in the coming years, he added.