Rice industry

For several decades now, rice farming has been one of the mainstays of Guyana’s agricultural sector – a sector which accounts for an estimated 30% of all employment. The farmers who produce the rice paddy supply privately owned commercial rice mills that mill the paddy into rice for local and export sales.

One fact that becomes immediately apparent even from a cursory review of the rice industry in Guyana is that the rice farmers have historically borne the brunt of the risks inherent in the industry and seem to continue to do so to this day.

And the risks are many. Farmers have to contend with unsuitable soil types that require the addition of expensive fertilizers. Then there are the uncertain weather patterns, which mean that crops might be affected by either excessive rainfall or drought during the four months to maturity. This means that the system of drainage and irrigation must function properly. To have a properly functioning drainage and irrigation (D&I) system presupposes the layout of the rice lands and the design of the D&I system are in sync, and that individual farmers can drain or irrigate their land without adversely affecting other farmers.

The D&I systems that exist in these farming areas are fraught with issues and this is a major bugbear in rice farming in Guyana. Crops have been depleted or lost because farmers were unable to irrigate or drain their cultivation at the optimum times. Even the much vaunted MMA/ADA in Region Five which gives its raison d’être in part as “the executing agency for the construction of all drainage and irrigation works in Region No. 5, Mahaica/Berbice on the north-eastern Atlantic seacoast of Guyana” has not been without controversy over the years, as it has been blamed for flooding endured by farmers even as recently as June 2016.

After successfully harvesting their crop, farmers must have the rice paddy dried to a required specification of moisture content, and ideally this requires sufficient available drying floor space for drying via sunlight or, alternatively, mechanical drying facilities. It is therefore quite an anachronism to see rice paddy still being dried on the roadways in Guyana, a practice that has been going on seemingly from time immemorial.

The farmers with the best quality paddy grains with acceptable moisture levels are usually offered the higher prices and roadside dryers of paddy usually have to settle for less. It should be noted that while the best paddy quality is rewarded with the best price, this does not mean that it is necessarily a fair price. Rice farmers are generally price takers, as only the largest farmers are able to negotiate somewhat with the buyers of paddy which are usually the rice millers. Consequently, many farmers operate at near break-even point and a significant amount claim to suffer losses continuously.

President of the Rice Producers Association, Leekha Rambrich recently posited to Stabroek News that “the profit margin is very thin and if farmers lose one crop, it is a big setback.” He also claimed that many rice farmers are opting out of rice farming and that there was a decline in cultivation.

The final hurdle rice farmers face having delivered their paddy and accepted the price is to actually receive full payment for their produce. It has become par for the course for rice farmers to be owed money by the buyers of their paddy – usually rice millers. Over the years government intervention has been necessary from time to time to reduce the colossal debts owed to farmers by millers – debts which have often exceeded half a billion Guyana dollars.

From all of the above it can be seen that the bulk of the risks involved in the rice industry is borne by the rice paddy farmers themselves. When the milling sub-sector owes large sums to the farmers, the millers are in effect financing their own operations using funds due to farmers. The savings garnered thus by the millers means that an equivalent cost is being carried on the backs of the farmers.

With all the woes of the rice farmers remaining largely unaddressed by successive administrations, it is no surprise that the Rice Producers Association reports that some traditional rice farmers are abandoning their lands while others are diversifying by turning to cash crops and provision farming and equipment rental to earn a living.

On the flip side, Guyana Rice Development Board Extension Manager, Kuldip Ragnauth has expressed a completely different viewpoint, that is, that rice cultivation is on the increase. He is quoted on the Minis-try of Agriculture’s website http://agriculture.gov.gy as saying, “I like to let the figures speak for themselves. We have already seen an increase in acres sown when compared to last year. So far, we have recorded 225,000 acres as opposed to 180,000 acres for the same period of last year. As a matter of fact, we had projected 210,000 acres to be sown for this crop looking back at the weather impact on the spring crop for this year and last year.”

While we are not in a position to treat Mr Ragnauth’s position with scepticism, we are mindful of that pithy quote about statistics attributed to the British Prime Minister Benjamin Disraeli. The point to be borne in mind is that rice farmers in Guyana have a very tough time doing the business of rice farming. They encounter multi-million dollar losses as a result of drainage and irrigation issues for which the central governments and regional governments are mostly responsible, with no recourse to remedies like crop insurance.

Rice farmers are unable to positively influence the price at which they sell their produce, and to top it off are forced to wait interminable lengths of time to be paid for significant portions of the money they should earn for the sale of their paddy.

If these issues are not addressed in a careful and studied manner, the rice industry as we know it could find its position in jeopardy.

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