Restrictions on rice exports eased in Myanmar as demand rises

The authorities have extended the validity period of rice export licenses to 60 days from July to September now that the number of people testing positive for COVID-19 appears to be declining, said U Nay Lin Zin, joint secretary of the Myanmar Rice Federation

The expiry period of the licenses had been slashed by half to 45 days since March, when the first cases of COVID-19 were detected in Myanmar, according to the Myanmar Rice Federation.

“The term of the licenses was for 90 days before COVID-19. We reduced this to 45 days during COVID-19. Now, the infection rate has declined and so we have raised it to 60 days. We will adjust it to 90 later,” said U Nay Lin Zin.

He added that export quota restrictions have also been removed. “In the past, one company had to export 300 tonnes or 500 tonnes of rice to meet the quota. Now, we have removed the quota so traders can export as much as they want. But, there is policy that they must contribute rice to the country’s reserves,” he said.

The country expects to export up to 150,000 tonnes of rice per month in July and August and around 100,000 tonnes in September, according to the Myanmar Rice Federation.

Between October 1, 2019 to June 12, the country exported more than 2 million tonnes of rice and broken rice, generating US$600 million in revenues.

More than 13 percent of the exports were conducted at the border with China while the remaining crops were shipped overseas to countries like Malaysia, Belgium and Senegal.

More recently, Myanmar also inked a bilateral agreement to ship 70,000 tonnes of rice to the Philippines, according to the Myanmar Rice Federation.

Demand from Thailand has also risen. This month, Thai merchants offered to purchase broken rice powder from Myanmar after an agreement to exempt the country from taxes was made, according to the Ministry of Commerce (MOC).

“We received approval to export powdered rice instead of broken rice. Thailand offered to buy,” U Khin Maung Lwin, assistant secretary of the MOC, told The Myanmar Times.

About 100 tonnes of rice powder is being exported on an average every two days and grinding is done in the factories in Myawady industrial zone, he said, adding the authorities will support more construction of grinding factories in that region.

“Thailand levies a 52pc tax on broken rice but there are no taxes in powder form. They want to buy as much as we can supply,” U Aung Myint Oo, rice merchant and director at Klohtoo Wah Co Ltd.