Guyana is seeking to increase its rice exports to Jamaica, after local paddy exports replaced US supplies last year.
With local rice production still booming and the global market prices dropping, new markets for increased exports are crucial.
Currently Guyana has less than 100,000 tonnes of rice on hand and while the figure is high for this time of year, the product is moving quickly according to those in the industry.
Traditionally Guyana would keep approximately 60,000 tonnes prior to the first harvest of the year in order to meet its commitment to its annual oil for rice deal with Venezuela.
One industry expert told Stabroek News that moving excess rice had to be a priority given falling international prices. Guyana’s rice production for 2013 was over 532,000 tonnes. Global price per tonne as of January 1, 2014 was US$441, down almost US$100 from the July 2013 price.
Global rice news, research and analysis site Oryza.com recently reported that the sole rice mill in Jamaica completely replaced US paddy rice with imports from Guyana in 2013, mainly due to higher prices of US rice.
It cited the USDA as the source of the information, while noting that Jamaica’s rice imports from Suriname have been increasing in the past five years.
US paddy rice imports by Jamaica declined about 93% from around 46,000 tonnes in 2008 to 3,300 tonnes in 2012, and have vanished in 2013, the report said.
“Trade sources say that the change in the pattern is due to the quality and pricing issues, according to the USDA. While Guyana paddy rice prices [are] high, those are cheaper than US paddy rice prices,” the report further said, while noting that imports from both Guyana and Suriname receive preferential treatment and US imports are subject to a 25% common external tariff (CET).
Stabroek News was told that current exports to Jamaica, which imports between 80,000 and 90,000 tonnes annually, are in line with traditional figures but the market could soon allow for additional imports, which local industry sources hope to capitalise on.
Guyana is also courting Cuba, Belize and Haiti in the hopes of reacquiring a lucrative market. Prior to the 2010 earthquake in Haiti, rice exports were up to 30,000 tonnes; since then, however, Guyana is responsible for a mere 2,000 tonnes.
The government is currently trying to finalise a new rice for oil deal with Venezuela, which caters for the export of 140,000 tonnes of paddy and 70,000 tonnes of milled white rice. Under the deal, the government pays the millers for paddy, which is then shipped to Venezuela, and the value of the shipment deducted from the sum outstanding for oil supplies.
Last year, the late signing of the deal held up exports, which did not commence until July. Finding the proper commercial vessel to transport the produce proved a further setback.
Industry stakeholders would like the Venezuelan deal to be signed as quickly as possible as it guarantees good prices. Once the deal is signed, exports of excess produce from last year’s crop should commence.
At the same time, Stabroek News has learned that millers plan to bargain for lower prices from farmers, although moving the excess reserves is expected to make it so mills would not have large stockpiles on hand.
Previously, the Rice Producers Association’s General Secretary Dharamkumar Seeraj had told Stabroek News that while the global price for rice was troublesome, Guyana was not looking to slow rice production.
He noted that other leading rice producing countries may themselves scale back production and that Guyana was looking to increase its export potential in the region.
Agriculture Minister Dr Leslie Ramsammy gave a similar indication when he stated that Guyana would be aggressively seeking alternative markets for rice exports, while fulfilling obligations to traditional markets like the European Union and Venezuela.
