Paddy earnings for the year are in excess of $23.5 billion with over $19 billion already paid to farmers, Deputy General Manager of the Guyana Rice Development Board Ricky (GRDB) Ricky Ramraj has said.
And pressure is being applied to millers to address their inability to pay farmers in a timely fashion and to ensure that the rest of the money is paid by the commencement of the second crop harvest, which is to begin late July early August.
Ramraj told Stabroek News that the recent protests in Essequibo were politically motivated. However, he did note that delayed payment by millers is a constant battle.
Ramraj said the industry is growing and growth is welcome. However, millers need to step up on their end. He said many millers have stated that the increase in paddy production has meant they needed to build facilities to dry and store paddy and rice. He said millers and the GRDB have asked farmers for their patience.
Ramraj acknowledged that farmers’ frustrations year after year in relation to late payments could reach boiling point and that was not what the industry wanted. He said millers are being asked to ensure that they are shipping more to the Venezuelan market because the payment system under the PetroCaribe Barter Agreement is stringent.
This process sees payments made through the Venezuela Rice Agreement, whereby the Agriculture Ministry makes a request to the Finance Ministry. The debt management unit overlooks the quotas and balances and a request is then sent by the Finance Ministry to the Office of the President and permission is granted to release funds. The Ministry of Finance will once again go through the process with the debt management unit and once clearance is granted a request is made to the Bank of Guyana to discharge funds into the GRDB’s account. Once this is done millers are paid in accordance with their Venezuelan quotas and are to pay farmers.
Ramraj stated that delayed payments will stem from other markets such as Europe and Jamaica where processing could take up to a month. He didn’t excuse the millers’ actions however and stated that they have to take responsibility for ensuring that they are capable of paying farmers. He explained that as millers are expanding their drying and storage facilities, money that should be paid to farmers is being spent elsewhere. He said the millers’ claim that they have to take the paddy and mill it as opposed to leaving it on the road or in the fields to spoil and as a result farmers are left to hope for payments in a timely fashion.
He said that since the Venezuela Rice Agreement came into being, many millers have become reliant on that market and the GRDB is tasked with managing other potential markets for exports. He said that millers needed to become more aggressive because their livelihoods are at stake.
In June, bankers and millers met, along with the Agriculture Ministry to discuss an overdraft system and possible loan criteria. But Stabroek News understands the banks are leery and want more stable and larger markets established prior to loans being distributed. Under the Venezuelan Agreement, 150,000 tonnes of paddy and 50,000 tonnes of white rice are to be exported in 2014. While Guyana has other markets none are as large as Venezuela nor as secure. Currently, Guyana has exported just over 30,000 tonnes of rice to Jamaica and recently a deal was signed to export 10,000 tonnes to Panama.
This publication understands that bankers would be comfortable with markets like Venezuela and the Haitian deal, a 50,000-tonne rice export agreement between SAJ Rice Mill at Burma, Mahaicony and an affiliate in Haiti.
