Farm­ers risk losses as rice price drops

The Myanmar Times - - Front Page - HTOO THANT thanhtoo@mm­

As paddy prices plum­met in Yan­gon on weak de­mand, farm­ers and traders warn that the mar­ket could be dam­aged as a re­sult.

‘Some [farm­ers] are [al­ready] har­vest­ing paddy but there are no bro­kers to buy it.’

Ko Myo Win Farmer

PADDY prices in the cap­i­tal are falling on weak de­mand and the drop risks dam­ag­ing the mar­ket, farm­ers and traders said.

The mar­ket price for 100 bas­kets of stored manaw thukha paddy in Nay Pyi Taw was al­most K850,000 in Septem­ber, but has since fallen to around K600,000, U Nay Soe, a rice seller in Py­in­mana township, told The Myan­mar Times.

Rice mer­chants in Myan­mar’s cap­i­tal fac­ing lower prices for stored paddy are in turn low­er­ing the price at which they are buy­ing newly har­vested paddy from farm­ers. The price for 100 bas­kets of mon­soon paddy har­vested this month is only K400,000, say farm­ers – much less than last year.

Nay Pyi Taw farm­ers hop­ing to sell fresh paddy are wor­ried be­cause when the price of 100 bas­kets falls much be­low K500,000 they risk losses.

“An acre of paddy costs at least K200,000 to K250,000 for seeds, har­row­ing, har­vest­ing and wages,” said lo­cal farmer U San Win, adding that an acre pro­duces per­haps 60 or 70 bas­kets.

This puts the cost of pro­duc­ing 100 bas­kets of paddy across a fairly wide range of K280,000 to K410,000. In or­der to be con­fi­dent of mak­ing any kind of profit, the mar­ket price needs to be at least K500,000, said U San Win.

But de­mand from China, the main des­ti­na­tion for most of Myan­mar’s milled rice ex­ports, has crum­bled re­cently. Se­nior fig­ures in the Myan­mar rice in­dus­try say the drop is down to China’s at­tempt to clamp down on il­le­gal cross-bor­der trade.

Lo­cal rice miller Ko Nay Soe said that be­cause China is not im­port­ing rice the mar­ket is al­most en­tirely lo­cal. Millers buy paddy from farm­ers, and sell the fin­ished rice to traders that ex­port to China. But with Chi­nese de­mand weak millers are buy­ing much less paddy than usual, said Ko Nay Soe.

The lat­est mon­soon crop has only just started be­ing sold, and the sup­ply of new paddy will be plen­ti­ful in Novem­ber and De­cem­ber. With de­mand weak the mar­ket is al­ready in bad shape. If Chi­nese de­mand con­tin­ues to slump then paddy prices will be in even worse shape in De­cem­ber, said Ko Nay Soe.

“Some [farm­ers] are [al­ready] har­vest­ing paddy but there are no bro­kers to buy it,” farmer Ko Myo Win from Aye Chan Thar vil­lage group in Lewe township said. Mer­chants sell­ing paddy stored from ear­lier in the year are not far­ing much bet­ter. Oc­to­ber typ­i­cally sees high prices for stored paddy, as sup­plies from the pre­vi­ous har­vest start to dwin­dle. But with the price for 100 bas­kets of stored manaw thukha paddy at around K600,000, mer­chants are mak­ing al­most no profit on the price they orig­i­nally paid, said Ko Myo Lin Aung, who stores paddy in Py­in­mana township.

Con­sumers are ben­e­fit­ting how­ever, with the price of a bag of milled manaw thukha rice on the lo­cal mar­ket falling from K28,000 in Septem­ber to K20,000 this month. U Ba Gyi, a farmer in Ky­oonoo vil­lage in Py­in­mana township, notes that the prices of other crops is also down rel­a­tive to ear­lier in the year. In­dus­try in­sid­ers say that Chi­nese bor­der authorities have tight­ened con­trols over the im­port of a range of agri­cul­tural prod­ucts in­clud­ing maize, sugar and beans.

“The price of beans and corn is also falling,” said U Ba Gyi. “Farm­ers are dis­ap­pointed.”

Corn prices in Nay Pyi Taw are less than half what they were at this point last year. The price of a bas­ket of black sesame beans has fallen from a high of K60,000 this year to be­tween K35,000 and K45,000 de­pend­ing on the quality.

Mung beans are down from a year high of K30,000 a bas­ket to be­tween K20,000 and K25,000.

– Trans­la­tion by Khine Thazin Han

Photo: Staff

Farm­ers plant rice in a paddy field.

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