For all its challenges associated with weak infrastructure, high investment costs, unfavourable weather and an unpredictable global market, Chief Executive Officer of one of Guyana’s most successful investors in the sector, Nand Persaud and Company, Rajindra Persaud firmly believes that over the long haul the rice industry has been a stayer, a success and that it has proven itself to be very much the front runner in the country’s still highly valued agricultural sector.
If the drastic decline of sugar is there for all to see and if the envisaged rise of an oil sector has already triggered warnings regarding the dangers of casting aside the food security assurances which farming has traditionally provided, arguably the country’s most successful investors in the sector insist that while, over the years, the business of managing what is now a multi billion dollar company has been exacting, it has been, at the end of the day, decidedly worth the while.
In recent years, Persaud told Stabroek Business during an interview, it has not been a question of ‘through the roof’ prices, but rather, one of world market prices holding their own sufficiently to allow reasonable reward for shrewd management and an understanding of the industry.
Recent years have been satisfying if not hugely rewarding. Across 2017 and 2018, rice prices have remained steady on the world market whilst global concerns about food safety have ensured that once you are prepared to search diligently there is always a market out there.
If the steady growth and expansion of Nand Persaud and Company has been there for all to see over the years, its success, last year, in reaching an agreement with Cuba allowing for the export of rice to that country was a significant eye catcher that placed it even further to the forefront of local private sector success stories.
That the company was able to make a successful move into the potentially huge Cuban market was due not only to an approximately 12.7 per cent increase in rice production locally last year over 2016, but the sense of boldness that has always informed Nand Persaud’s search for external markets. The breakthrough in Cuba led to talk of setting the relationship on a firmer footing by undertaking a historic investment in a rice milling plant in Cuba.
The journey, the company’s CEO says, has not been without its potholes in the road. Setting aside those imponderables associated largely with the vagaries of the weather the success of the rice industry depends largely on the support which the sector receives from the state through undertakings like sustained investments in access roads and dams, drainage and irrigation and access to new lands that can help improve paddy yield. Much of the land currently under cultivation has been “overused” and it is only through continued investment in opening up new lands that the industry will continue to serve the country’s economy well.
In the instance of Region Six, inclement weather and the consequential inaccessibility of access dams are problems. In these circumstances there is a debilitating knock on that impacts negatively on harvesting. Not only does it cost more to move the paddy from the fields to the mills, but the delays in harvesting frequently results in poor crops. There are other logistical and administrative problems affecting the industry too…….like what, sometimes, is a lack of timeliness in releasing water into the rice lands during the planting season, putting at risk millions of dollars in farmers’ investments.
As rice ‘delivers’ more for the Guyana economy Persaud believes that government should pay even more attention to providing the support services – like the maintenance of access dams and improving the efficiency of the water management regime.
Then there is the imponderable of inclement weather. This year’s May/June downpours certainly did the country’s second crop no favours. The knock on effect on the volumes of paddy harvested was clear.
Persaud believes that changes in lifestyle and social patterns also dictate changing patterns in the rice industry. The scarcity of unskilled labour, for example, may well be a consequence of a drift into other forms of employment. These days, he says, farmers continue to encounter difficulty in recruiting labour to apply fertilizer to the rice fields with the inevitable consequence of having to pay higher rates for the service. In response to this challenge Nand Persaud and Company is investing in the introduction of aerial spraying technology, the implementation of which, the Company’s CEO says, is awaiting the approval of the Defence Board.
The Nand Persaud Company is aggressively looking for new lucrative markets while maintaining their traditional markets. Cuba, the company’s CEO says is “a good deal” though he concedes that they are involved in an aggressive search for wider markets. He explained that the Cuba deal rests on a credit arrangement and that the company is seeking additional cash deals though he adds that the Cuba arrangement has been a breakthrough for the company which it intends to keep. At the break of the new year Nand Persaud and Company will be ‘back on the road’ seeking new markets and Mexico and Europe are prime markets.
Nand Persaud and Company has not escaped unscathed from the wider challenges that have placed limits on local rice production. During the interview Persaud explained that local production shortfall has caused the company to look to Suriname for rice in order to adequately fulfill its international obligations. During this year the company acquired ten thousand tonnes of rice from the neighbouring Republic.
Steeped as the company is in the ebb and flow of the rice industry’s fortunes, its Chief Executive Officer responds to each question with the same upbeat outlook. His disposition suggests that Nand Persaud and Company have settled into the rice sector for the long haul so that what the outside observer may regard as intractable problems confronting the country’s rice industry are, from the perspective of the Region Six high-tech millers and high profile exporters, mere challenges to overcome.