The first shipment of imported milled rice to meet domestic demand for August and September should arrive next week .
Millers, traders, consumers, agricultural authorities and rice growers agreed to import 1.3 million quintals of rice paddy in order to meet domestic demand and the shortfall in domestic production.
However, this first batch is milled rice, which has led to the discomfort of growers and others who consider this as “non-compliance” with the agreement between them all. "The shipment of milled grain only benefit supermarkets, reported Ruben Zevallos, president of the Association of Rice Producers Abroad", reported Prensa.com.
In the last 5 years the pricing system in force has transferred more than $390 million from the pockets of consumers to rice producers.
A statement of the Ministry of Commerce reads:
Rice sector subsidies in excess of $100 million for the second year
San Jose, May 8th, 2012. Today Costa Rica reported to the Committee on Agriculture of the World Trade Organization (WTO) that subsidies on rice in 2011 reached $104 million, which exceeds by more than 650% the annual amount permitted under the WTO’s Agreement on Agriculture.
From May 15th and for a month, 650,000 pounds of hulled rice, 650,000 quintals of unhusked rice, and 60,000 quintals of beans will be imported in the coming months.
The Licensing Committee of Tafiff Rate Quotas has made two calls for imports of corn and rice, according to the requirements of the WTO.
A total volume of 150,000 metric tons of corn has been assigned, of which 149,000 tons correspond to corn for feed and 40 metric tons is finished product, reported Panamaamerica.com.pa.
With favorable weather conditions, the crop may amount to one million quintals, 300 thousand more than in 2011, which would generate $15 million.
If the weather is favorable this year, El Salvador could reap a million quintals of rice, an increase of 300,000 bushels compared to the previous year, generating income of $15 million and creating 272,000 direct and indirect jobs, said Max Granillo , president of the Association of Irrigation of the Drainage and Irrigation District (Areza).
The Government of Costa Rica admits that the rice growers will continue to receive support much higher than that allowed by the World Trade Organization.
Costa Rica does not have a defined end date for the high subsidies for rice and reducing them to the level allowed by the WTO, reported Nacion.com.
A WTO spokesman told the EFE news agency in Geneva that the Central American country continues to exceed the agreed ceiling of domestic support (AMS, or aggregate measure of support) with trade distorting effects. In 2010, the entire Costa Rican AMS was for rice, with $109.7 million allocated, despite the commitment of San Jose to set a limit for the support of $15.95 million.
In order to overcome the distortions that have occured in the market, the National Assembly of Producers has decided to reduce the amount of sown land by 23 hectares.
Following the decision by the National Assembly of Producers, an agreement to issue certificates for the purchase of rice by industrialist is still pending. A negative response from them could provoke protests from farmers, who say they are willing to take to the streets.
Producers and manufacturers have agreed to set the price at $21 per quintal of rice for 2012.
Following negotiations between producers and millers, the parties agreed to a price of 400 lempiras ($21) per quintal of rice which will run until next year. This price represents an adjustment of 50 lempiras ($2.62) compared to the price paid in 2011 (350 lempiras- $18.37).
Coopeliberia, Compañía Arrocera Industrial, Corporación Arrocera Costa Rica and El Porvenir are the four companies which account for 75% of the local market.
While the market is concentrated in only four companies, according to figures for the rice year 2010-2011, Ana Victoria Velasquez, director of the Directorate of Support of Competition under the Ministry of Economy, Industry and trade (MEIC), states that this does not violate any laws.
Consensus between producers, industrialists and government officials is paving the way towards ending the legally fixed price of rice in Costa Rica.
Rice liberalization will take place over the coming months, by means of an executive decree. The first step will be to release the value that the miller pays producers and after a few months (in which the stock bought at higher prices will be consumed), consumer prices will be released.
Not being self sufficient, Panama will again need to import more than one million quintals from abroad from July in order to meet domestic demand this year.
The supply of rice for domestic consumption in Panama is guaranteed until July 2012 with existing stocks of 2.7 million quintals of clean, dry husks in warehouses, according data from the Authority for Consumer Protection and Competition (Acodeco), recorded from January 30th to February 3rd, 2012.
The increase in the price of local milled rice in 2011, has boosted imports.
According to the Ministry of Agriculture and Livestock (MAG) as of September 2011 a total of 17,000 metric tons had been imported. "In the next three months of this year, imports could have tripled the 62,000 metric tons of 2010", reported Elfinancierocr.com
In the country it is the Ministry of Economy that establishes the price of rice, by decree, a measure that has been questioned by the World Trade Organization, who argues that more subsidies are being granted than allowed.
The president of Honduras announced, "We have discovered a smuggling ring, but do not worry, because we will put it in its place."
In the latest chapter of the story in which 14,300 tons of rice were going to come into Honduras without having paid taxes, the president of Honduras, Porfirio Lobo, said the importer of the shipment will pay a $2.5 million tax bill, corresponding to 45%, reports LaPrensa.hn.
Dairy farmers and rice growers continue to demand that the tax reform proposal made by the government of Nicaragua be enlarged, and are complaining about the high costs of production.
Furthermore, they fear that consumer prices will only be stable only for a short while, reported La Prensa in its online edition.
The government of President Daniel Ortega has proposed in Parliament the removal of the Selective Consumption Tax (ISC) for milk based beverages and also a reduction of income tax (IR) on stock transactions that exceed an annual amount of C $60 million (U.S. $2.6 million) for rice and raw milk. Business leaders believe that this proposal is insufficient.
This is the amount of grain, in the hands of 17 producers, that has not been received by the industry, therefore the Costa Rican Minister of Agriculture will assume responsibility.
CONARROZ will buy 5,649 tonnes of unprocessed rice which is currently in the hands of 17 producers, promised the Minister of Agriculture and Livestock, Gloria Abraham Peralta, to a group of producers in the northern part of Costa Rica with whom she met.
Producers are complaining about the government’s unfulfilled promises to place their crops in the market, and demanding an end to rice imports.
Producers in the Guanacaste area are protesting again, demanding that the government respects a promise agreed last November, which, according to the rice growers, would resolve the placement of more than five thousand tons of rice which has been stored in dry silos, both public and private, since September 2011.
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