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Home > Featured > Estimating a Price Structure for Non-marketed ‘Rice Medicine’ in Sri Lanka – Peshala Karunarthne and Prof. Wasantha Rathnayake

Estimating a Price Structure for Non-marketed ‘Rice Medicine’ in Sri Lanka – Peshala Karunarthne and Prof. Wasantha Rathnayake

Sri Lanka has a valuable collection of indigenous rice cultivars with roughly 2000 conserved indigenous rice varieties. Indigenous rice varieties are a valuable component of biodiversity in Sri Lanka.They are rich in medicinal and nutritional properties, which can contribute to the development of the society.
There is, however, little or no knowledge among consumers of the healing effects and nutritional properties of the indigenous rice varieties with consumers focusing mainly on the taste and price of the rice whereas globally there is an increasing interest in and demand for organic and ‘indigenous’ foods. Due to market failures, in Sri Lanka, due to market failures, the value of indigenous rice varieties remains arbitrary while price changes tend to occur very quickly in the market”. This may prevent indigenous rice varieties from becoming the preferred option of consumers and threaten in turn the demand for indigenous rice varieties in Sri Lanka.
This study will estimate the consumers’ willingness to pay for selected “indigenous” rice varieties of Sri Lanka taking into consideration the nutritional and medicinal value of each rice variety in order to determine a proper price structure for these non-marketed ‘rice medicines’ found in Sri Lanka.
Models and Estimation Methods
We employed Contingent Valuation Method (CVM) to estimate the willingness to pay (WTP) or demand for the indigenous rice varieties while offering nutritional and healing benefits as a value to consumers.
Scenario Development
Five selected indigenous rice varieties with their unique medicinal and nutritional properties were used for this study. They are Suwandel, Pachchaperumal, Kuruluthuda, Kalu Heenati and Madathawalu. The CVM was applied in the study and, based on the unique medicinal and nutritional properties of each rice variety, five different scenarios were developed for each rice variety. They are as follows:
Suwandel rice promotes fair and healthy skin; improves the functioning of the excretory system; improves vocal clarity; enhances male sexual potency; helps to control diabetes, ulcers and constipation; reduces high blood pressure
This is considered as a very good controller of diabetes and especially good for those with high blood pressure; development of red blood cells; control of the activity of hormones and for proper functioning of the excretory system; increases the production of insulin and reduces the production of thyroxin in the body.
Heenati is a rice formulate with various juices to treat diabetic patients. The high fiber content helps to regulate the bowel movements and constipation. This rice variety is also highly recommended for hepatitis patients. It is recommended for daily consumption by lactating mothers due to its nutritional value.
This is known to improve bladder functions and is considered very good for patients with diabetes and high blood pressure. It is also recommended for consumption by persons having high cholesterol and is said to enhance male sexual potency. It is also known to infuse comparatively high energy in consumers.
This rice variety is said to aid the development of the human body by boosting the immune system. It is known to prevent illnesses like diabetes; remove toxic components, especially some cancer agents, from the human body. It is also said to clean the blood circulation system and promote the activity of sweating glands. Since it is known to strengthen the immune system, it is considered suitable for infants and for lactating mothers.
One thousand five hundred and forty-five super-market consumers were interviewed using a pretested questionnaire. The willingness-to-pay (WTP) was calculated for the establishment of a price structure for the above five selected indigenous rice varieties in the following manner: the WTP at household level for the indigenous rice varieties of Suwandel, Pachchaperumal, Kuruluthuda, KaluHeenati and Madathawaluwas Rs. 472/-, Rs. 323/-, Rs. 319/-, Rs. 356/- and Rs. 404/- per kg, respectively. The resulting prices recorded are slightly different (either higher or lower) than the existing market prices for these rice varieties.
The findings of the study show that a majority of consumersare willing to pay higher prices to purchase indigenous rice varieties. Thus, the estimated WTP can be used to introduce a new price structure for indigenous rice varieties available for sale at places such as supermarkets.
The results also point to the need to come up with a long-term policy for the purpose of managing problems relating to the establishment of prices of non-market environmental goods. It is proposed to introduce a proper promotional campaign for marketing the indigenous rice varieties among the general public highlighting the medicinal and nutritional value.
Prof. Wasantha Rathnayake is a distinguished Professor in Environmental Management attached to the Faculty of Management Studies, Sabaragamuwa University of Sri Lanka and He is a well-known Environmental Economist in Sri Lanka. He was the Dean of Faculty of Management Studies from 2011 to 2017. At present, he is the President of Section F of Sri Lanka Association for Advancement of Science and Prof. Wasantha Rathnayake is the Vice-Chancellor of the Ocean University of Sri Lanka.

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