Burma’s Rice Exports Up 40% in 2014-15

By Kyaw Hsu Mon 8 April 2015

RANGOON — Burma’s rice exports rose more than 40 percent in the 2014-15 fiscal year, with shipments to regional heavyweight China dominating the trade despite Beijing’s official ban on imports of the product from Burma, according to data provided by Soe Tun, the chairman of the Myanmar Farmers Association and joint secretary of the Myanmar Rice Federation.

Figures from the Ministry of Commerce put total rice exports at more than 1.7 million tons in the fiscal year ending March 31, bringing in nearly US$645 million. Exports were shipped to 64 countries including China and Japan, as well as other nations of Asean, Europe and Africa.

“Among them, China purchased more than 1.1 million rice tons this year via border trade. Even though they [Beijing] banned rice exports to China, the volume still increased,” Soe Tun told The Irrawaddy on Wednesday.

In 2014, China officially banned rice imports from Burma, demanding that a trade agreement be signed guaranteeing that most rice is milled and meets certain quality standards. China had long been, and continues to be, one of Burma’s biggest customers for rice, much of which is harvested in the Irrawaddy Delta and shipped over land borders in Shan and Kachin states.

Burma’s government does not enforce the ban, effectively making it a trade that is legal on one side of the countries’ shared border and illegal on the other.

Early this year, members of the Myanmar Rice Federation and officials from the Ministry of Commerce met with Chinese officials to discuss legalizing Burma’s rice exports once again.

Soe Tun said that while Burma had proposed to export 1 million tons of rice to China this year, the agreement drawn up between the two countries only allows for 100,000 tons.

That arrangement, legalizing a small proportion of the actual trade on both sides of the border, has not yet been implemented, Soe Tun said.

“I expect that legal rice exports to China will begin in May,” he said.

“As an initial step, the public company Mapco [Myanmar Agribusiness Public Corporation] will export 3,000 tons of rice to China in May.”

A Burmese rice milling company and the Chinese firm CAMC Engineering Co. Ltd. in February signed a joint venture Memorandum of Understanding to improve the quality and capacity of rice milling operations in Burma. The partnership aims to boost Burmese rice exports, in part by improving the quality of its rice as well as milling processes before exporting to China.

The 2014-15 fiscal year’s rice export volume exceed the expectations of the Myanmar Rice Federation, which had predicted the figure at 1.5 million tons.

Thaung Win, a rice exporter who also acts as secretary of the Myanmar Rice Millers Association, said that outside the China trade, rice shipments to some EU countries, Japan and other Asean nations were also on the rise.

According to the Myanmar Rice Exporters Association, Burma’s rice exports in 2013-14 stood at about 1.2 million tons, down from 1.47 million tons the year before. President Thein Sein has set a target to export 4 million tons of rice by 2020.

Reliable data on rice exports prior to the installation of Thein Sein’s quasi-civilian government are hard to come by, but Burma was once known as the “rice bowl of Asia” and was a major industry player until decades of economic mismanagement by success military regimes sent exports tumbling.

A World Bank report in June found that Burma could greatly increase its agricultural exports if it improved the quality of rice by expanding and upgrading domestic rice mills. The report said that since economic and political reforms began in 2011, rice exports have significantly risen, but in the past two years export volumes had leveled off at about 1.3 million tons annually.