Muse traders flout rice exports ban

Despite a ban on rice exports as Myanmar struggles to recover from a nationwide flooding disaster, traders are continuing business at the Muse border with China.

In early August, the Myanmar Rice Federation announced a ban on exports for six weeks as more than 500,000 acres of paddy flooded nationwide and more than 300,000 acres were destroyed, sending the price of rice soaring.

However, trading has continued furtively across the Muse border in northern Shan State, according to insiders, who say some are transporting rice in small light trucks or even in cars, and others are tricking authorities by disguising the rice as other commodities.

Sugar exporters claim they are able to export rice in big trucks by masking it as sugar, because the packaging is similar. Rice exporter U Sai Kyaw confirmed that rice continues to be sold to China.

“I am staying within the guidelines, but if the suspension is extended, we will oppose it,” he said.

Since the export ban was announced, the price of every variety of rice in Muse has risen by around K1500 compared with the Mandalay market, said traders.

Myanmar Rice Federation (MRF) officials told media earlier this month that those contravening the ban on exports will face action, possibly supported by the government.

U Soe Tun, vice chair of the Myanmar Rice Federation, told The Myanmar Times that the embargo will be lifted as planned on September 15. As a result of the ban, Myanmar has already missed out on 200,000 tonnes of exports, he said.

A combination of the 45-day ban and damage caused by flooding means that Myanmar will miss its 2-million- tonne rice export target for this financial year, said U Soe Tun, adding that the export target has been lowered to between 1 and 1.5 million tonnes.

Although the floodwaters have largely receded, in many areas it is too late to re-cultivate fields, said U Aung Than Oo, vice president of the MRF to media on August 28.

“Even if farmers are pushed to grow more rice, we still won’t be able to export as much as last year,” he said. Some regions usually produce an early batch of rice by the end of September. This year however, most farmers in flood-hit areas were unable to start cultivating until the end of August.

He added that varieties of beans, which are winter products, should be cultivated early to benefit farmers.

In financial year 2015, which finished at the end of March, Myanmar rice exports reached a record 1.8 million tonnes, and the MRF signed a memorandum of understanding with China to export more this year, as well as negotiating more exports to European markets and to the Philippines.

“We agreed to increase export volumes, but this included exemptions in case of natural disaster, so there won’t be a problem,” said U Aung Than Oo.

China buys more than half of Myanmar’s rice, though much of the business is conducted on an informal cross-border basis. Sales at the Muse border have fallen this year after a number of raids by custom officials on Chinese importers.

Source: Myanmar Times

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, "Dagon City", “MOGE”, “yangon stock exchange”,"MECTEL", "hydropower", etc.

To learn about the business opportunities in Myanmar click here

To evaluate the various segments of the market that you could possibly enter base on your competencies you can do a Custom Market Entry Strategy Research. You can see a sample report at page "Actual Sample of Client Report”. Click here to go to page.

Do you know that IE Singapore is giving up to SGD 20,000 support for Singapore company to venture into Myanmar? To learn more click here