After 2009 decline…
RICE Producers Association (RPA) General Secretary, Mr. Dharamkumar Seeraj said yesterday that, though 2009 production was healthy, the price for the grains was not. He told the Guyana Chronicle that prices for the staple last year paled in comparison with the previous year.

But Seeraj was optimistic the situation will improve this year.

“All indications are pointing to an upward trend and the prices for paddy should be between $3,000 and $3,500 per bag. It has been seen that the prices have already gone up on the international market and that will hold.

“It will not reach the levels of 2008 but would definitely be better than 2009,” he forecasts.

The 2008 prices ranged from $5,000 to $12,000 per tonne, depending on the quality and US$118M was garnered from the export of 196,000 tonnes of rice.

“In 2009, we would have exported 64,000 tonnes more rice than in 2008, yet we earned US$4M less,” Seeraj reported.

He explained that, while production attained record breaking levels last year, the hazy international trade saw a decline in rice prices.

In 2005, 2006 and 2007, many manufacturing countries were utilising their food stock to produce bio-fuel, resulting in losses of millions of grains which, traditionally, go into the food cycle, Seeraj said.

He added that the global stock-to-use ratio of grains and cereals hit the lowest level in 2007, plummeting to about 17 per cent.

“The stock-to-use was dangerously low, relative to an average of about 35 per cent…that sent panic signals along the corridors of decision makers, especially in the developed world.

“In 2008, they reacted in almost chaotic fashion and they started to purchase grains and cereals all over to ensure food security, so that drove the prices for those commodities way above to what we are traditionally accustomed,” Seeraj stated.

EXPORTS
Guyana exports about 75 per cent of its total annual production and, for that reason, whatever happens on the international market, immediately affects the local trade.

The top RPA official recalled that, in 2008, when the prices rose, farmers were happy but many went almost bankrupt at the decline last year.

The Government, cognizant of the situation last year, intervened and injected a $400M grant into the industry to improve farmers circumstances.

The money was used to construct drying facilities throughout the rice belt and to help farmers purchase fertiliser.

According to Seeraj, the voucher disbursement to support farmers acquisition of the commodity is nearly completed and, shortly, construction on the first drying floor will commence in Region Three (West Demerara/Essequibo Islands).

He said, at the end of this Spring crop, it is expected that farmers will have access to places for drying and storing their paddy, so they could sell at the right time for reasonable prices.

“In the Autumn crop of 2009, farmers would have sold their paddy for between $2,400 and $2,600 per bag but, if they have paddy to sell now, they could easily get $3,000 per bag,” Seeraj disclosed.