Million Tons Rice Export Target Despite Floods

By May Lay 27 August 2012

The Myanmar Rice Federation (MRF) has officially recommitted to its target of exporting one million metric tons of rice during the current 2012-2013 fiscal year despite serious flooding in the Irrawaddy Delta which has damaged nearly 80 percent of the region’s paddy fields.

Around 70,000 people have been evacuated from their homes to stay in 219 emergency relief centers around the delta after the heaviest monsoon since 2004, but the government remains confident that rice exports will still thrive due to backup stock.

“We plant over 16 million acres annually for the rainy season crop and so flooded areas do not matter for total production. That’s why it will not impact on the next crop production as we will handle this with our buffer stock to keep the local rice price stable as well as exporting,” MRF General-Secretary Ye Min Aung told a press conference on Thursday.

The MRF bought 1.6 million tons of buffer stock from last year’s rainy and summer crops, according to an order by President Thein Sein last August. The reformist president intended to keep the minimum rice price for farmers high by collecting buffer stock when rice exports were suffering from low demand in 2011.

“If the time when the flooding subsides is too late for replanting rice, we will compensate with other crops for this season,” said Ye Min Aung.

The MRF has been keeping the amount of buffer stock available confidential as it does not want to encourage market speculation when people hear rumors about less production this year. Although the initial amount was publicized, the quantity remaining after a certain amount was sold off remains secret.

Rice is a major agricultural export for Burma and the staple food for the vast majority of its population, added Ye Min Aung.

“Local people are worrying about the high price of rice and some are starting to buy bags to store to last until the next summer crop,” the owner of Aung Matta rice trading company told The Irrawaddy.

MRF, formerly the Myanmar Rice Industry Association (MRIA), already set up a public company named Myanmar Agribusiness Public Corporation (MAPCO) and will begin selling shares to investors on Sunday. The firm is obviously keen to present a positive image to ensure investors are not put off by the floods.

Heavy rain and overflowing rivers have inundated the Irrawaddy Delta region—considered Burma’s rice bowl—since the end of June. Deforestation has added to water erosion with precious minerals being washed away. When the annual heavy rain comes to these main agricultural areas, water cannot easily flow to the sea and flooding covers the paddy fields for many days, said agricultural experts.

“This is a wake-up call for Burma. We need improved communication infrastructure and transportation,” said Ye Min Aung. “We can prevent people repeatedly experiencing these problems. We have to set up an early warning system in Burma to prevent this sort of disaster.”

“Paddy plants can survive in floods for only 10 days. Flooding is still in the fields and there is nothing we can currently do. After the water leaves the fields, we have to decide what kinds of paddy seeds to grow depending on how many days are left for the rainy season,” said a rice farmer with over 50 years experience from Waw Township in Pegu (Bago) region.

“Farmers work the whole year for growing paddy in  the rainy season and summer, but there is no profit for us. We cannot hold our paddy for a long time as we have to pay back arrears. The rice price is low when the paddy is in farmers’ hands. The price will increase when paddy is in traders’ hands,” said Myint Soe, the owner of ten acres of paddy fields in Thar Paung Township in Irrawaddy Region.

The Burmese have the world’s highest rice consumption at 210 kg (460 lb) per person annually. This amounts to 90 percent of the rice domestically produced—11 million to 13 million tons consumed per year, compared with production of 14 million to 15 million. Export markets are Africa, Bangladesh, Indonesia, Malaysia, the Philippines and East Timor.