“Millers should not use farmers as a bank” – Holder

Agriculture Minister Noel Holder and Guyana Rice Development Board (GRDB) General Manager, Nizam Hassan, have finally responded to the growing concerns of stakeholders in the rice industry who are affected by non-payment from buyers in Panama.
This swift response on Monday came one day after a report in Guyana Times that detailed the extensive delays regarding payments. However, in an article published by the Department of Public Information (DPI), it contended that Government was not responsible for farmers being owed for rice shipped to Panama.
In fact, DPI quoted Minister Holder as saying while the rice industry is doing well, “millers should desist from using the farmers as a bank.” He explained that for the most part, transactions are done through an established letter of credit, noting that the Panamanian market offers a 30 per cent increase in price for rice.

“Given the existing arrangement and the fact that it is not an irrevocable letter of the credit agreement, the millers evidently want to enjoy both sides of the coin. They want both the increased prices as well as the terms outlined in the line of credit agreement. Millers have the option of paying farmers from funds they have or arrange payments through established banking agreements and are urged to do so since the law stipulates that farmers are to be paid two weeks after paddy is supplied to the millers,” a section of the DPI report noted.
GRDB General Manager Nizam Hassan, who has not been entertaining calls from this newspaper for the past several months, also told DPI that “the Board is not in possession of the funds and is currently working with officials in Panama to ensure that the outstanding balance will be made available for payment at the earliest possible time.”
The General Manager further told the Government’s official media outlet that millers are aware that when they supply the Panamanian market, they will receive payments from the GRDB when it is received from Panama. He added that the market with Panama is a Government market that pays a higher price, but, is however “sometimes” delayed due to “Government processes”.
“Millers are owed for the two contracted supply – the last contract for 2017 and the first contract for 2018 and not for contracts for any previous years,” Hassan further told State media.
It was further reported that many small millers, who supplied rice under the past two contracts, were recently paid by the Rice Board to the tune of US$1,270,901 from its own resources.
“Additionally, GRDB recently received US$550,000 from Panama, which is currently being paid to millers.” The General Manager further pointed out that reports of millers securing private deals through the Mexican market has nothing to do with the Board.
“Shipments to the Mexican market are done in a private capacity, henceforth; the Board is not handling any monies for rice supplied to that market,” Hassan asserted, which was understood and published by this newspaper.
It was reported that many in the industry abandoned the 2014 Panama-Guyana arrangement after the GRDB was not forthcoming with payments. Sources indicated that millers secured private deals through the Mexican market and according to reports; one ship recently sailed to the Latin American country and another is reportedly on its way with rice. However, it is from these very deals that many farmers felt they could be paid, thus questioning why millers are reluctant to hand over payments,” this publication reported on June 17, 2018.
These clarifications were repeatedly sought by Guyana Times but Hassan would often avoid calls. In 2014, Guyana inked a deal with the Government of Panama for 5000 tonnes of rice to be shipped there on a monthly basis. The recent non-payment is adversely affecting farmers across the country who said their ability to sustain their livelihood as rice producers is under threat.
Millers alleged Hassan has been telling them he has to check with the Agriculture Minister to enquire about their payments.
Guyana Rice Millers Association (GRMA) head, Leekha Rambrich observed earlier this year that even though the GRDB is accessing the money from buyers, the entity had an obligation to pay millers. “GRDB signed a contract with Panama to supply this rice and not the millers. And GRDB is responsible for paying the millers. So that question has to be referred right back to him (Hassan),” Rambrich stated in February 2018.
Guyana exported some 540,000 tonnes of rice for 2017, which saw its highest numbers since 2015 when 535,000 tonnes was recorded. However, farmers have seen reduced earnings for their paddy with the loss of the PetroCaribe rice deal which was cancelled by Venezuela in 2015.