Sunday, August 20, 2017

Rice body to establish national stockpile

The country’s leading rice industry body held a workshop with exporters and traders last week to float a plan that would allow exports to continue but also safeguard national food security.

Myanmar Rice Industry Association (MRIA) vice president U Aung Than Oo proposed during the December 1 meeting an idea to create a rice stockpile, which will be contributed by exporters, to ensure price stability in the domestic market.

Under the plan exporters will be required to contribute from 3 to 5 percent of each shipment they make to MRIA stockpiles across the nation. Specialist rice companies will be asked to contribute 3pc, while normal exporters will be asked to provide 5pc.

The plan, which has not been agreed to, would be governed by a number of rules that would allow contributors to exchange some rice from the stockpile when exporting to minimise losses caused by vermin and moisture.

“Rice will keep for three months during dry season but only one-and-a-half months during the monsoon period. For that reason we need to ensure it is regularly turned over to prevent losses,” said U Tin Shwe, the owner of one rice export company.

U Aung Than Oo said the stockpile would be held until next November but sold onto the local market to cool prices if and when required.

“When we face rice shortages in August, September and October the price naturally rises, which is something we want to avoid. But we also want to ensure that exporters don’t lose too much by taking part in this project.

“And rice that is not sold onto the domestic market will be exported as well,” U Aung Than Oo said on December 1.

He added that MRIA will pay the labour and transport fees required to create the stockpiles but subsequent rice exchanges would be paid for by the exporter.

U Kyaw Kyaw Win, an MRIA central executive committee member, said contributing 3-5pc of each shipment to a national stockpile was not the major issue facing exporters.

“The rice we export [ehmeta, which includes 25pc broken grains] is not in high demand internationally, so it’s not a problem to contribute some. What we really need to be thinking about is how we can earn higher prices,” he said.