The first shipment of paddy, under the US$18.8M deal sealed with Venezuela six weeks ago, is now scheduled to leave for the neighbouring state this weekend, Minister of Agriculture Robert Persaud says.
An official from Venezuela’s Agriculture Ministry, Persaud told Stabroek News yesterday, was in Guyana all last week “to ensure compliance”. The loading of the vessel for the first shipment, which was expected to be since the first week of November, starts this week and the ship should be heading to Venezuela by weekend.
Some 4,000 tonnes of paddy, Persaud said, is expected on the shipment. He further noted that the Guyana Rice Development Board (GRDB) is not responsible for shipping. Rather, the miller/exporter will take on this responsibility.
On October 21 Guyana and Venezuela inked the US$18.8M ($3.7B) rice purchase agreement which should see 50,000 tonnes of paddy and rice being supplied to that country in the next few months at a price higher than current export prices. Persaud had disclosed that initially 10,000 tonnes of white rice and 40,000 tonnes of paddy will be exported. The export price for paddy, he had said, will be US$330 per metric tonne (covering cost and freight) while for the “five percent broken” white rice, the cost will be US$560 per tonne.
It was expected that by October 26 a Venezuelan team would have arrived from Caracas to inspect and look at all the other considerations so exports could commence. Exports were expected to start during the first week of November and be completed by the first week of February. However, despite the first shipment being delayed for almost a month there has been no explanation from relevant local officials.
Observers had raised concerns about how the Venezuelan deal would affect Guyana’s ability to supply other markets, more particularly the Jamaican market. Questioned about this recently, the Agriculture Minister assured that even if Jamaica purchases the full 60, 000 tonnes this year there will still be enough for Venezuela and other markets.
In recent correspondence with this newspaper Persaud said: “Our rice production is estimated to be 369,110 tonnes and revised exports at 254,227 tonnes. Our total exports for last year were 199,233 tonnes, we exported to Jamaica 42,199 tonnes. If Jamaica will purchase the full 60,000 tonnes this year, this will only mean an additional 17,801 tonnes over that of their last year’s (purchase). If that is added to the last year’s total export and then taken from the projected exports for 2009, we will have an excess of 37,234 tonnes of rice for another market.”
General Manager of the GRDB Jagnarine Singh had told Stabroek News that even with the increase in rice production this season the “full cooperation” of millers is needed to meet the US$18.8M Venezuelan deal. At the time, questions about whether Guyana would be able to meet its end of the deal and the effect such a large demand would have on commitments to other markets were just surfacing.
Singh had told Stabroek News, shortly after the agreement was signed, that supplying Venezuela is a very difficult task. He’d said that before the deal was inked with Venezuela the GRDB contacted millers who then pledged to produce various amounts to be exported to that country.
There is a possibility, Singh stated, that Guyana will not be able to supply the amount agreed on but this again depends on the millers.
The GRDB, Singh said, will be responsible for the shipment of the rice and paddy and payments to millers and farmers. However, following Persaud’s statement yesterday about the GRDB no longer being responsible for shipping this newspaper could not reach Singh for a comment.
An element of bartering, the GRDB General Manager had also told Stabroek News, is included in the deal. Rice he said he will be shipped to Venezuela but the Government of Guyana, which buys petrol from that country, will be responsible for paying the GRDB for some of it.
“It isn’t directly bartering,” Singh had said, “but rather it has an element of bartering in it. The government buys petrol from Venezuela so some of the money made from the rice deal will be discounted from that account and the Ministry of Finance will have to pay us [GRDB) for the rice.”
General Secretary of the Guyana Rice Producers’ Association (GRPA) Dharamkumar Seeraj told Stabroek News at the end of October that millers who will be buying paddy for the Venezuelan shipment have agreed to pay farmers $3,000 per bag of paddy.
