THE announcement by Agriculture Minister Robert Persaud that the export licence of Mahaicony Rice Limited (MRL) will not be renewed next year is unfortunate but most necessary because this company has tested the patience of the farmers and the authorities and there was no alternative. MRL has been frequently delinquent in paying rice farmers for grain bought from them. Hardly a crop goes by without the issue of non-payment not arising with this company. In the latest non-payment issue strenuous efforts were made to get it to pay the farmers it owed but without much success.
The company’s debt to local farmers is estimated at some $200M but the actual amount is yet to be verified, as MRL has not made its accounting records available to the Guyana Rice Development Board (GRDB) for an audit.
A team went to MRL for that purpose but was denied access to the accounts and the matter is with the Director of Public Prosecutions (DPP).
“We expect the police to do their job”, Mr. Persaud said, noting that GRDB’s request for information to conduct the audit is lawful and in accordance with Section 10 (1) of the Rice Factories Act.
MRL is one of the largest local rice millers, doing business in Guyana since 1991 and reportedly controls a significant percentage of paddy purchases. It is clear that this company has little regard for local rice farmers and for the laws and regulations governing the rice industry and feels because it is among the largest players in the industry it could hold farmers to ransom.
However, Minister Persaud said that without MRL the sector has enough capacity to take off the paddy produced as facilities in Regions Two, Five and Six are expanding.
He also pointed out while the sector can do better with more milling capacity, there cannot be a compromise when it comes to farmers’ payments, which are, now, more than nine months overdue.
MRL had signed agreements with rice farmers to make half the payments after the first 14 days and the rest after 41 days, delays attracting two per cent plus the current lending rate at banks as interest.
But the company has not honoured the agreements and, in an attempt to ensure that such problems are reduced, steps are being taken to amend the Rice Factories Act, so that farmers secure added protection.
While the government has a policy of working in tandem with the private sector it cannot allow companies such as MRL to trample on the backs of farmers without whom there would be no rice industry. Most rice farmers are not wealthy people and rice farming is their only means of earning a livelihood and to deny them payments is an injustice of the worst proportion because it is interfering with their ability to put food on their tables and provide a proper education for their children.
Rice farmers work extremely hard and face constant challenges and risks because of weather patterns, fluctuations of global market prices, rising prices of inputs among other factors and therefore it is a most inhumane act to deny them their hard-earned cash.
So while it is regrettable that such a harsh measure has to be taken, the circumstances leave no alternative and if firm measures are not taken against defaulting millers then it might indicate a sign of weakness on the part of the government and set the tone for millers to exploit.
Rice farmers should now feel more assured with regards to payments by millers with this firm measure announced by the Agriculture Minister against MRL.