Myanmar Farmers Say Govt Failing to Buy Rice at Floor Price

By Salai Thant Zin 4 November 2019

PATHEIN, Ayeyarwady Region—Rice paddy farmers in Ayeyarwady Region have complained that merchants are paying them less than the minimum price recently set by the government.

The government’s Leading Committee for the Protection and Promotion of the Rights and Interests of Farmers, led by Vice President Henry Van Thio, fixed the floor price for rice this year at 500,000 kyats for 100 baskets of paddy (US$327.30 for about 2.09 tons) in a move to protect the interests of paddy farmers.

But farmers in Ayeyarwady Region said merchants only pay for around 450,000 kyats for 100 baskets of paddy.

“In Maubin, paddy prices are between 450,000 and 480,000 kyats. This is the price given by merchants and rice millers. Though the government said the minimum price is 500,000 kyats, nobody is paying that price, and the government is not buying directly from farmers, so we can only sell at market rates,” said rice farmer U Hla Htay of Yenangyoung village in Maubin Township.

The government said in the second week of October that it will pay the floor price for paddy that meets quality standards: the grains, once processed, must have a moisture content of 14 percent and the baskets can’t contain any dust, sand or gravel.

According to the government’s statement, if the market rate is higher than the floor price, rice is to be bought according to the market rate, but if the market rate is lower than the floor price, rice is to be bought at floor price.

The floor price will be applied for this year’s monsoon paddy season and next year’s summer paddy season. Once minimum prices fall below the minimum price, paddy purchase committees formed by regional and state governments are responsible for purchasing rice from farmers with the approval of the vice president’s leading committee. But in the case of Ayeyarwady Region, the regional paddy purchase committee is failing to intervene.

Currently, the market prices of lower grade paddy are between 400,000 and 480,000 kyats per 100 baskets in Hinthada District, between 450,000 and 480,000 kyats in Maubin District and between 480,000 and 500,000 kyats in Myaungmya and Pathein districts.

“The price of 500,000 kyats fixed by the government is not bad. But we are paid only just over 400,000 in Kyangin,” said farmer U Hlaing Kyi from Koe Taung Village in Hinthada District’s Kyangin Township. “The profit is quite small. If the government will buy paddy, I want them to show up, on the ground, soon after the harvest.”

The problem is partly due to measurement differences. The government has adjusted the size of one basket to equal 46 pounds. But rice merchants and millers are still using the previous basket size of 50 pounds. As a result of the discrepancy, farmers are forced to sell an extra 400 pounds of rice per 100 baskets for no additional pay.

The Irrawaddy was unable to obtain a comment from Ayeyarwady Regional Minister for Financing and Planning U Htay Win about the fact that the government has yet to purchase rice from the farmers.

“The Ayeyarwady regional government has held two meetings with us to buy rice when it falls below 500,000 kyats,” said Ayeyarwady Region Rice Millers Association Chairman U Soe Win. “We drafted plans for rice purchases and presented them to the government. The government said it would seek approval and budget from the Union government.”

Around 50 percent of Myanmar’s rice exports are shipped to China. Myanmar exported 3.58 million tons of rice during the 2017-18 fiscal year, the largest volume in 70 years, according to the Ministry of Commerce.

Though the Myanmar government allows official rice exports to China, Chinese authorities consider most rice imports from Myanmar to be illegal but still allow rice merchants to bring rice across the border. After Chinese authorities launched a crackdown on illegal rice imports from Myanmar in 2018, Myanmar’s rice exports to its neighbor declined significantly, dropping by around 1 million tons.

Rice prices have so far continued the downward trend in the 2019-20 fiscal year due to low demand from China.

Translated from Burmese by Thet Ko Ko


You may also like these stories:

Myanmar Govt Backs Minimum Price for Rice Amid Weak Market

Myanmar Court Jails Farmers for Using Vacant Land