As Myanmar enters 2024, its rice industry faces unprecedented challenges that threaten both domestic food security and the country's position as a major rice exporter. A perfect storm of political instability, armed conflict, economic turmoil, and climate issues has severely impacted rice production, leading to concerns of potential shortages and skyrocketing prices.
Regional Conflict Disrupts Farming
In western Myanmar's Rakhine state, intense fighting between the military junta and the Arakan Army has forced many farmers to abandon their fields. Ar Mula, a farmer who fled to Maungdaw town, reported, "Everybody has left our village. We can't grow paddy there." The conflict has not only displaced farmers but also disrupted supply chains, with the junta destroying infrastructure and blocking trade routes.
Kyaw Zan, chairman of the Arakan Peasant Union, provides a stark assessment of the situation:
- Rakhine state typically has 850,000 acres dedicated to paddy cultivation.
- In 2023, approximately 750,000 acres were cultivated.
- For 2024, cultivation is expected to be reduced by half due to conflict and supply issues.
- Many farmers are now only able to cultivate 1-2 acres out of their usual 10 acres, focusing on subsistence farming.
While specific figures for the entire country are not provided, these local reductions are likely to have a significant impact on Myanmar's overall rice production.
Economic Challenges and Input Shortages
Farmers across Myanmar are struggling with skyrocketing costs of agricultural inputs. Fertilizer prices have surged from 130,000 kyats per sack last year to 200,000 kyats in 2024. Fuel costs have jumped 50%, from 2,000 kyats per liter to 3,000 kyats. These price increases, coupled with a shortage of seasonal workers due to military conscription and conflict, have forced many farmers to reduce their planted acreage or switch to less effective cultivation methods.
In Mon State, farmers report offering up to 25,000 kyats per day for workers, more than double last year's rate, yet still struggle to find labor. As a result, many are resorting to direct seeding instead of transplanting rice seedlings, a method that can reduce yields by up to 50%.
Government Response
The economic crisis has led to soaring prices for rice, a staple food for most Myanmar citizens. In response, the Myanmar Rice Federation has implemented an "affordable rice scheme" in major cities:
- 58 shops in 18 townships of Yangon
- 120 shops in Mandalay
- 96 shops in Naypyitaw
This scheme limits purchases to two bags per household per month and sets price controls. However, the sustainability of this approach is questionable without subsidies for shopkeepers.
The junta has also taken a heavy-handed approach, arresting 11 rice vendors, including a Japanese national, and charging 30 shopping centers for selling rice above mandated prices. This crackdown extends to high-level officials and rice mill owners, who face questioning about rising market prices.
Production Figures and Export Data
Despite these challenges, Myanmar managed to export 345,467 tonnes of rice and broken rice in the first three months of the 2024-25 fiscal year, earning USD 175 million.
- Monthly breakdown:
- April: 111,862 tonnes ($55 million)
- May: 71,279 tonnes ($36 million)
- June: 162,326 tonnes ($84 million)
These exports go to over 20 countries, including Indonesia, Malaysia, the Philippines, China, and Belgium.
This follows a strong performance in the 2023-24 fiscal year, when the country exported over 1.6 million tonnes, generating more than USD 845 million in revenue.
However, industry experts warn that these figures may not be sustainable given the current crisis. The Myanmar Rice Federation has implemented an "affordable rice scheme" across major cities, setting price limits and purchase restrictions in an attempt to stabilize the domestic market.
Government Response and Market Intervention
The military junta has responded to rising rice prices with a heavy-handed approach, arresting vendors and shopkeepers accused of price manipulation. Eleven rice vendors, including a Japanese national, have been detained, facing charges that could result in up to three years in prison and hefty fines.
This crackdown extends beyond retail, with 30 shopping centers charged for selling above mandated prices and nearly 60 individuals questioned. Even high-level officials and rice mill owners are under scrutiny.
Looking Ahead
As Myanmar enters the critical monsoon planting season, the outlook for the rice industry remains uncertain. Farmers in key rice-producing regions like Sagaing and Magway report income decreases of at least 36%, compounded by challenges ranging from extreme weather to landmine contamination.
The success of the upcoming crop will be crucial in determining Myanmar's food security and economic stability for the remainder of 2024 and beyond. Without significant improvements in the political and economic situation, the country's rice industry – and the millions who depend on it – face a precarious future.
