JDS

Thursday, January 13, 2011

Sri Lanka flood death toll rises to 23, crop risk grows

Posted by JDS

By Shihar Aneez and Ranga Sirilal | Reutrers
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The death toll from flooding across a third of Sri Lanka rose to 23 people on Thursday, and another 100,000 people were forced from their homes as heavy monsoon rains lashed the island and threatened food supplies.

The Agricultural Ministry said at least 21 percent of Sri Lanka's staple rice crop had been destroyed, raising concerns over supply shocks and higher food inflation just as the central bank lowered lending rates to spur growth.

Greater-than-normal monsoon rains since early January have pounded Sri Lanka's Northern, Eastern, Central and North Central provinces, setting off mudslides, swamping roads and bursting hundreds of dams and reservoirs.

At least 325,000 people have been forced from their homes by the waters, 23 have been killed, 36 have been injured and one was missing, the national Disaster Management Centre said.

In the hardest-hit area, the eastern port of Batticaloa, rainfall since the beginning of January stood at 1.8 metres (5 ft 11 in), more than its average annual rainfall of 1.6 metres, Meteorology Department Deputy Director S.R. Jayasekera said.

"About 161,878 hectares of paddy lands are under water and it is still too early to estimate the extent of damage. If the water subsides in the next two-three days we might able to recover 30 percent of it," Agriculture Minister Mahinda Yapa Abeywardene told Reuters.

That translates to 21 percent of Sri Lanka's total 570,000 hectares of paddy destroyed, and as much a third still at risk.

Food inflation risk

Abeywardene said that the government had about four months' supply of rice to offset the losses.

"It might affect the inflation but we are trying with various short-term methods to control it," he said. That includes providing seeds of fast-growing rice to help farmers replant once the waters recede."

Sri Lankan President Mahinda Rajapaksa has deployed the military to rescue people boat and assist in relief efforts.

The Meteorology Department late on Thursday said there was a possibility rains would ease on Friday night.

The flooding comes just as Sri Lanka's central bank lowered policy rates even further to spur corporate credit growth, saying it had inflation under control for 2011. Economists and analysts have said that it remains a risk.

Sri Lanka has been able to maintain low inflation since May 2009, the end of a three-decade war with the Tamil Tiger separatists, mainly due to the higher supply coming from the Northern and Eastern Provinces where the fighting took place.

Food accounts for 45.5 percent of the total goods basket used to compile inflation, which hit a 21-month high in November due to higher food prices, government data shows.

Flooding and displacements are common in Sri Lanka, where a southern monsoon batters the island between May and September, and a northeastern monsoon runs from December to February.

© Reuters