Last Saturday, while witnessing the harvesting of a bio-fortified rice variety at Lesbeholden, Black Bush Polder, Berbice in the presence of farmers, officials from Caricom and the Inter-American Institute for Cooperation on Agriculture, Minister of Agriculture Zulfikar Mustapha declared that India’s ban on rice exports would open the market for Guyana. He was quoted as saying, “Guyana rice will be in more demand so I am hoping that this crop we can surpass the target that was set…” In reality, it is far from being that simple, as Minister Mustapha is no doubt aware, but politicians are wont to make grandiose statements and he is clearly no laggard in that area.
Mr Mustapha also stated that “places like the Netherlands […] and right in Caricom too” had increased rice imports from Guyana, but was not specific. In fact, in January this year, expanding on the government’s $300 million allocation to the rice industry during his budget presentation, Minister of Finance Dr Ashni Singh had stated that Guyana had managed to secure new markets in the British Virgin Islands, Estonia, Slovenia and Lebanon. One imagines Mr Mustapha was referencing additional markets and surely did not need to be shy about locations and amounts.
Local rice production figures are not usually readily available. However, last year, according to Minister Singh, the country harvested 859,993 tonnes of paddy, which resulted in 558,995 tonnes of rice being produced. Typically, Guyana exports about seven-eighths of the rice it produces, but turns around and also imports this grain. A visit to any of the popular supermarkets would reveal sacks and packets of rice varieties on sale, which were produced in other countries. Furthermore, let us not forget the consternation that unfolded last year when Indian High Commissioner Dr KJ Srinivasa reported that local businessmen had imported a large quantity of rice from India in 2021 in order to meet their export quotas. Government officials had denied any knowledge of this, but Dr Srinivasa was unlikely to be mistaken as the request was made through his office.
Among the top ten rice producing countries in the world, India with its 120 millions tonnes a year on average, stands at number two, surpassed by China which churns out some 200 million tonnes per annum and reportedly corners 28% of the global market. The other eight top producers are Indonesia, Bangladesh, Vietnam, Thailand, Myanmar, the Philippines, Brazil and Pakistan. At the bottom of the ladder, Brazil and Pakistan produce approximately 15 million tonnes and eight million tonnes respectively. Brazil’s main markets are Venezuela, Peru, Senegal, the Netherlands and the United States. Pakistan has huge market shares in Malaysia, the United States, Italy and the United Arab Emirates. It is worth noting here that the cost of production in these top rice-exporting countries is significantly lower than it is here. So while indeed India’s withdrawal of non-basmati rice from the market is having an adverse effect, it stands to reason that importers will automatically turn to high-producing nations to have quotas met.
Lest we forget, Guyana’s rice exports have had conflicting fortunes. One need not go too far back to remember the glory days of the rice for oil agreement with Venezuela. Dubbed the PetroCaribe Rice Compensation Scheme, that pact, which was signed in October 2009 and was renewable annually, saw the Venezuelan government setting the maximum quantity of paddy and white rice that it would receive as well as the premium above the world price at which it would value those imports. It would then subtract this amount from what Guyana owed for oil shipments. Buoyed by what appeared to be a secure market, local rice farmers increased their cultivation acreage exponentially, many unaware of the specifics of the agreement, were betting on future payments. When Venezuela decided in 2015 that it would not renew the contract, the fallout for many farmers and millers was massive.
More recently, millers successfully sued the Guyana Rice Development Board (GRDB) for rice it had purchased from them for export to Panama in 2018, for which it was never paid. The GRDB in turn did not pay the millers citing its client’s recalcitrance, but was found to be at fault by the court in June this year and ordered to pay the millers what was owed together with interest accrued as well as court costs.
Exports to Caricom have also not been without conflict. For years, Trinidad and Tobago as well as Jamaica have sought to import rice from outside the region, rather than purchase from Guyana. Numerous accusations have also been made as regards pricing, quality and supply. In 2019, rice exported to Jamaica was condemned and discarded by the authorities in that country after it was to found have mould and discoloration.
All that notwithstanding, the local industry continually faces other challenges including discordant weather patterns caused by climate change, and increased prices in fuel and fertilisers, to name a few. Many small farmers and millers have complained over the years about being driven to bankruptcy by circumstances over which they have no control. Given this scenario, as well as all that has happened in the past, it would behove those involved, including Minister Mustapha to manage their expectations.