Paddy ex­ports called off

The Myanmar Times - - Front Page - SU PHYO WIN su­phy­owin@mm­times.com

The Min­istry of Com­merce is plan­ning to spend K15 bil­lion buy­ing paddy di­rectly from farm­ers, but has can­celled a plan to al­low paddy to be ex­ported abroad.

THE Min­istry of Com­merce has can­celled plans to al­low paddy ex­ports as part of mea­sures to ad­dress a slump in prices. In­stead the gov­ern­ment in­tends to buy paddy di­rectly from farm­ers, some of whom have crit­i­cised the pro­posed floor price for the gov­ern­ment pur­chase pro­gram for be­ing too low.

U Khin Maung Lwin, as­sis­tant sec­re­tary at the com­merce min­istry told The Myan­mar Times that paddy ex­ports were be­ing aban­doned be­cause of the po­ten­tial im­pact on the live­stock in­dus­try.

“Bro­ken rice and paddy husk [which come from har­vested paddy] are very use­ful for the live­stock in­dus­try [as an­i­mal feed],” he said. “And there are a num­ber of rice millers in the coun­try [that rely on paddy for busi­ness]. We con­sid­ered paddy ex­port as a mea­sure but it is not pos­si­ble at the mo­ment.”

U Myo Tint Htun, deputy sec­re­tary at the Min­istry of Agri­cul­ture, Live­stock and Ir­ri­ga­tion said the gov­ern­ment had banned paddy ex­ports in pre­vi­ous years be­cause it was bet­ter to ex­port fin­ished prod­ucts.

“Sell­ing paddy [abroad] is quite risky and you have to a much larger quan­tity of paddy than rice to get the same rev­enue,” he said. “Also test­ing the qual­ity of paddy for ex­port will be dif­fi­cult.”

Rather than per­mit paddy ex­ports, the com­merce min­istry is ask­ing for K15 bil­lion from the gov­ern­ment to buy paddy at a min­i­mum price from farm­ers in Yan­gon, Bago and Aye­yarwaddy re­gions,” said U Khin Maung Lwin.

“The cabi­net has ap­proved the de­ci­sion to give K15 bil­lion to the Min­istry of Com­merce for pur­chas­ing paddy from [those] three re­gions,” he said. “We are go­ing to start the process in De­cem­ber.”

Paddy pur­chas­ing groups will be formed un­der the tem­po­rary Agri­cul­tural Prod­uct Man­age­ment Com­mit­tee (APMC) – as stip­u­lated in the Pro­tect­ing Rights and En­hanc­ing Eco­nomic Wel­fare of Farm­ers Law, which was re­vised in 2013.

The APMC is made up of re­gional gov­ern­ment of­fi­cials, mem­bers of the Union par­lia­ment and rep­re­sen­ta­tives from rice trad­ing and milling as­so­ci­a­tions, said U Khin Maung Lwin.

“Un­der the pro­tect­ing rights of farm­ers law we have to sup­port [them] or buy the paddy at a cer­tain price if the prices fall [too much],” he said, adding that the price of paddy had fallen to levels that made it hard for farm­ers to cover pro­duc­tion costs. “We are sure this is the best way of get­ting farm­ers a higher price.”

But the price at which the com­merce min­istry in­tends to buy has sparked com­plaint from the agri­cul­tural in­dus­try. The min­istry is plan­ning to buy 100 bas­kets of av­er­age­qual­ity paddy for K380,000 said U Khin Maung Lwin. How­ever, farm­ers re­port that with bet­ter weather dry­ing out soaked paddy and expectations of gov­ern­ment ac­tion, prices in sev­eral ar­eas are al­ready higher than that.

U Thein Aung, pres­i­dent of Free­dom of Farm­ers League, told The Myan­mar Times that the price for 100 bas­kets in Aye­yarwaddy Re­gion was around K400,000.

“We are ask­ing for higher paddy price,” he said. “But when the gov­ern­ment plans to buy at a price lower than the cur­rent mar­ket price, it’s proof that the min­istry thinks the mar­ket price is fair. I can’t un­der­stand why they would of­fer less than the mar­ket value.”

U Khin Maung Lwin said the aim of the pro­gram was to help cover farm­ers’ pro­duc­tion costs, “not make them rich”, he said. The cost of pro­duc­tion was what was de­ter­min­ing the gov­ern­ment pur­chase price, not the mar­ket price, he added.

The cost of pro­duc­ing 100 bas­kets of paddy varies widely with re­gion, farmer and land and paddy qual­ity. Nay Pyi Taw re­gion farm­ers say the cost of pro­duc­tion 100 bas­kets can range from K280,000 to K410,000.

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