November 13, 2016

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Myanmar rice market encounters challenges

A farmer being seen ploughing on a field in Zigon, Bago Region. Photo: Phoe Khwar
A farmer being seen ploughing on a field in Zigon, Bago Region. Photo: Phoe Khwar

The Myanmar rice market is being faced with many challenges in its attempt to enter the highly competitive international market.
Concerted efforts need to be exerted by all the stakeholders who are engaged in supply chain and the officials concerned to maintain a stable price, to make a profit for those who are participating including farmers, to reduce processing and transportation costs, to have a fair price for input, to boost the yield, to cultivate the pedigree crops to a higher yield, to produce high-quality rice with the use of modern mills and to systematically store the rice in keeping with international criteria, said experts.
Myanmar yielded about 12.20 million metric tonnes from 7.21 million hectares of acres of land in the 2015-2016 fiscal year, whereas the rice volume yielded from Viet Nam from 7.67 million hectares of acres of cultivation land was 28.17 million metric tonnes. More than double the amount of rice was produced by Viet Nam from about the same area of land, according to the Ministry of Commerce.
Only 12.5 per cent of the total volume of rice from Myanmar flows into foreign market. Local consumption is found to be the major market. The decrease in production in 2015 and 2016 was attributed to flooding for two straight years, plus the high cost of input materials: fertiliser and pesticides. The high production cost resulted in an increase in price. The volume of rice exports in the 2015-2016 fiscal year slumped by 296,656 metric tonnes, whereas that of broken rice slumped by 50,687 metric tonnes when compared to that of 2014-2015 fiscal year, it is learnt.
Rice is the staple food of Myanmar and plays a vital role in the agricultural export sector. Myanmar’s rice was mostly exported to Bangladesh, the Philippines, ASEAN and African markets from 2003 to 2008. The market then extended to Russian and Middle Eastern markets. China has become the main buyer of Myanmar’s rice in 2011 through the border areas. After a lift of the sanctions by the European Union (EU) against Myanmar in 2012, Myanmar’s rice could penetrate the EU market through normal trade, according to the Commerce Ministry.
However, only a limited quota of rice is legally exported to China and anything above that amount that enters China is considered illegal trade. The Chinese market results in a greater profit than other international markets because Chinese merchants do not choose the rice varieties to purchase and offer a higher price than the market price. But rice export are on the decline because of confiscation from the China side, the depreciation of the yuan and flooding in the Shweli river, according to rice merchants.
Dr. Than Myint, the Minister for Commerce, authorities concerned, the Myanmar Rice Federation, the Myanmar Rice Millers Association and businessmen reportedly discussed these matters concerning the progress of Myanmar rice market, global rice market and market price on 29thOctober in Yangon region government office.
About 300,000 tonnes of rice are slated for export to foreign countries in the upcoming three months from November, 2016 to January, 2017. —Mon Mon

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