In the context of a drop in production, in Costa Rica the government decreed a rise from $36.18 to $37.65, the price of a 73.6 kg sack of rice in bulk placed in the industrial plant.
The agreement modifying the price to the rice producer was published on June 5 in La Gaceta, and the government's action is taken in a context of low local production, because between the 2016-217 and 2017-2018 harvests, the volume produced decreased by 21%.
In Costa Rica, a bill under analysis in Congress would force industrialists to contribute to the National Rice Corporation with an additional 5% of the value of the rice purchased under import schemes due to shortages.
Although the aim of the two bills that are being discussed in the assembly is to comply with a resolution of from the Sala IV (4th Court) which ordered consumers to be incorporated into the board of directors of Conarroz, it was also used to modify in the law texts other aspects to which industrialists are opposed.
84 thousand hectares of crops were flooded and 67 thousand kilos of trout and tilapia, 24 thousand hens and about 7 thousand tons of sugar were lost because of storm Nate.
The impact of the climate phenomenon was felt in most agricultural activities in the country, and although shortages are not foreseen in sectors such as rice and sugar, in others supply could be affected in the coming months.
The Commission for the Promotion of Competition is opposed to the fixing of grain prices, the only good in the country whose price is established by decree.
Although Corporación Arrocera Nacional (Conarroz) continues to insist on the negative effect of freeing up the price of rice, the Commission for the Promotion of Competition (Coprocom) is maintaining its stance against the measure, arguing that it has not served to increase the volume produced or improve the productivity of the rice sector.
Imports of husked rice grew by almost 200% between the periods 2011-2012 and 2015-2016, and even when paying a tariff of more than 35%, imports easily compete with the subsidized local product.
The competitiveness of imported rice is such that"... it is estimated that for the current period (1 July 2016 to 30 June 2017), purchases will reach 54,000 tons.That is almost three months consumption, in that presentation alone."
The decree declaring a shortage authorizes the purchase of paddy rice for the period January to June 2017.
The decree authorizing an import quota for paddy rice due to shortages in the domestic market, was published on Wednesday in the Official Newspaper, La Gaceta.
Estimatations of national consumption for the period 2016-2017 are of 340,000 tonnes of paddy rice, 53% of which is covered by domestic production, equivalent to 180,000 mt; 21.5% by imported rice, under the DR-CAFTA, equivalent to 73,000 tonnes and 7.0% from the Southern Cone, equivalent to 24,000 mt, leaving a shortfall of 63,000 mt, which will be covered with the decree of a shortage.
In the next few days the government plans to publish a decree declaring a shortage and authorizing the import of duty-free grain.
Due to a decline in local production, there will not be enough stocks to meet demand from January 2017, therefore the import of about 70,000 tons, free from the 33.10%tariff, has been authorized.
The chairman of the Board of the National Rice Corporation (Conarroz), Eliécer Araya, told Nacion.com that "... The need to import is now stronger because of a smaller domestic crop. About three years ago the proportion of consumption of national productionwas 60% and this has now gone down to 50%. "
The National Rice Corporation states that adhering to the regional initiative blights what has been achieved in bilateral agreements with each country in the Alliance.
The Costa Rican agro industry has closed ranks against the country's accession to the Pacific Alliance. Both producers and the minister himself, Luis Felipe Arauz, have stated that the agreement is unfavorable for products such as rice, coffee, swine, beef cattle, ornamental flowers and strawberry growers.
The gap gets bigger and industrialists have once again brought the subject up for discussion by asking for a repeal of the decree which since June 2015 has fixed grain prices in the country.
Despite the fact that since 2009 the international price has been consistently below the local price, in Costa Rica the government insists on protecting producers, who are opposed to the request made by industrialists to eliminate the decree which has kept prices fixed since June 2015. The formal request for derogation was submitted in November 2015 by the National Association of Manufacturers in the Rice Sector (Aninsa).
The National Insurance Institute has announced it will modify two regulations so that non irrigated rice crops can once again receive coverage which was suspended earlier this year.
Rice farmers who grow grain on unirrigated land may be eligible sometime before March to be covered by the National Insurance Institute (INS) which suspended coverage earlier this year.
Having been affected in the last two years by losses in this category, the state insurance provider has suspended the issuance of policies for rain fed rice harvests, and plans to make changes to the insurance terms.
Authorities at the Ministry of Agriculture plan to ask the National Insurance Institute (INS) to reconsider the measure in the North Huetar and Atlantic Huetar regions, where rice farmers are complaining that they have already planted a significant amount of land. Losses incurred by the state-run insurer with this policy in 2015 exceeded $4 million.
Costa Rica is the one of the best examples of what happens when obstacles like the coming and going between state paternalism and trade affect the social and economic development.
While receiving an award from the National Association for Economic Development for Freedom (ANFE) 2014, Juan Carlos Hidalgo gave a stark analysis of the Costa Rican situation, which highlights the apparent contradictions between sustained economic growth and the painful reality of growing poverty.
The state has reduced insurance premiums for crop insurance for rainfed rice to $224, $197 and $149 per hectare for areas of high, medium and low risk, respectively.
Although the premium reduction is partly due to the request made by the rice sector, the reduction is not enough according to producers.
Carlos Chaves, president of Conarroz, told Nacion.com: "...
Denouncements have been made over distortions in the rice market where a supermarket chain and four other major players are on the receiving end of benefits from a perverse price fixing system.
An article in Nacion.com reports that former President of National Assembly of Rice Producers notes that these market actors, whose interests would be seriously affected by the liberalization of grain prices, "...
Between 2008 and 2013 the size of areas sown with rice in the north of the country increased by 92% and in the Caribbean coast they declined by 86%.
The moisture level of the soil together with other related factors to climate and characteristics of each area have led rice farmers to shift the main areas of cultivation from the Atlantic region to the Northern region.
Real Estate Development & Adventure Park Jacó, Costa Rica. Multiple Investment Opportunities Available. The Ocean Ranch eco-residential development is located...
O4Bi is a system that allows to control and manage what a company needs: the complete process of development of works, accounts receivable, treasury, banks, sales and accounting.
O4Bi is a very robust system that allows to control and...
Operating Company dedicated to the manufacture of gluten-free and sugar-free products, OHNE brand. The OHNE brand has 8 product lines: square bread, sweet...