Paddy price is on the decline even as the government is drawing up guidelines for the procurement of the crop at the basic price. In view of this, millers have held up processing rice, bringing down the supply of rice at the Bayintnaung market and Muse gate, and cooling prices.
“With the border demand decreasing, the price of rice is likely to remain on the low side,” according to Bayintnaung commodity depot.
The price of paddy dropped below K400,000 per 100 baskets in early November. At present, it is pegged at around K450,000 per 100 baskets. To purchase paddy at the basic price, the regional government is waiting for rules and regulations, which will be set by the government. As a result, millers are waiting for the right time for processing as rice price is cooling in the Yangon market.
On 15 October, the government fixed the basic price of paddy (low-quality variety) at K500,000 per 100 baskets (one basket is equivalent to 46 pounds) for this year’s monsoon paddy and the 2020 summer paddy. The government has pledged K15 billion for purchasing paddy, in case the market price falls below the basic price.
“The Bago Region government has asked for K8 billion to purchase paddy. To set the rules and regulations regarding that, we will call a meeting soon. Afterwards, we will pay the subsidy to them. However, we will figure out a way so they can repay it. The Ayeyarwady Region government has sought around K5 billion. The existing fund is adequate to make the allocations. It is available so they can buy paddy, if the market price falls below the basic price,” said U Aung Htoo, the Deputy Minister for Commerce.
At present, the Bago, Ayeyarwady, and Yangon region governments have asked the leading rice procurement committee to buy paddy at the set floor price, he said.
The concerned region and state governments are preparing plans to purchase paddy if the price drops below the basic price.
However, discussions on disbursing the funds allocated under the government purchase plan, rules, regulations, and payment terms are still under way, the minister added.
The agricultural management group and paddy purchase groups formed by the leading committee will initiate the purchase plans in remote places, where it is hard to trade paddy at the basic price. The plans are being drafted at present. The Myanmar Rice Federation and warehouse businesses will also cooperate in the plans.
Growers are facing financial hardships due to low price offered at harvest time, coupled with high input costs, said a grower from Yedashe Township. —Ko Htet
(Translated by EMM)