Myanmar agrees to be part of Asian rice 'cartel'

Myanmar agrees to be part of Asian rice 'cartel'

Agence France-Presse, Yangon

Myanmar has agreed in principle to be part of a rice "cartel" formed by Asia's leading rice exporters aimed at regulating prices as well as stabilizing the world market, market sources here said.

Thailand, Vietnam, China, the United States, Pakistan, India and Myanmar -- in that order -- are the world's leading rice exporters with annual exports totaling 18 million tons according to 2000 figures.

The envisaged six-nation organization would comprise Thailand, Vietnam, China, Pakistan, India and Myanmar which together make up 70 percent of the world's rice exports, the industry sources said.

Thailand floated the proposal last month, saying the association would be modeled on the Organization of Petroleum Exporting Countries (OPEC) but would not act as a price-fixing cartel.

"This concept is good in principle and will benefit the rice farmers who face fluctuating world prices but it may not be easy to establish because rice production is not regular and thus difficult to control," one expert told AFP.

"Besides, the concept is still in its infant stage and a lot of coordinating work and technical issues needed to be thrashed out before the idea can be put into practice," he said.

Myanmar sits low on the rung of world rice exporters but has lately been attempting to boost its annual production by increasing acreage and modernizing outmoded agricultural methods.

Last year's rice production showed a healthy seven percent increase to 13.5 million metric tons which not only ensured self- sufficiency but promised healthy exports.

"Myanmar's current annual rice production is put at 13.5 million metric tons and with home consumption estimated at over 10 million tons, there is still enough surplus for export," the expert said.

However, the military government's target of exporting in excess of 1.0 million tons is "too ambitious".

"A more realistic figure would be around 600,000 to 750,000 tons," he said pointing out that although annual production may have increased, electricity shortages posed a huge problem for rice mills.

"Many of the numerous private rice mills are facing operational difficulties due to a lack of electricity at this juncture," he said.

The government has assured that by 2005, the state will be generating enough electricity to meet demands.