Rice mills are vital to Myanmar’s most important agricultural value chain. They are the essential link between paddy fields and rice bowls. As such, any serious disruption or shock to rice mills will impact both rural rice-producing households and urban consumers. In their research, Joseph Goeb, Nang Lun Kham Synt, Phoo Pye Zone , and Yulu Tang utilize the findings from a series of phone surveys with rice millers to assess how COVID-19 related challenges are affecting Myanmar’s rice mills. They also provide policy recommendations to improve business conditions for rice mills and help them cope with the COVID-19 economic crisis.
You can view the full policy note by Joseph, Nang Lun Kham Synt, Phoo Pye Zone, and Yulu in English here.
Background
Throughout 2020, the Myanmar Agriculture Policy Support Activity (MAPSA) conducted a series of telephone surveys with approximately 500 rice millers in three important rice-growing regions of Myanmar: Ayeyarwady, Bago, and Yangon. MAPSA researchers observed an increase in disruptions to rice demand and paddy supply due to restrictions implemented in early September to mitigate the second wave of COVID-19. However, in late September, the Myanmar government implemented necessary but more stringent and widespread stay-at-home orders, which resulted in a dramatic increase in disruptions for rice millers.
This blog post presents highlights from the latest round of the rice miller survey conducted in October.
Effects of COVID-19 on rice millers
Since the start of the survey rounds, the most common business disruptions reported by millers have been in buying paddy and selling rice. Figure 1 shows that these disruptions increased significantly in October when 68 percent of miller reported disruptions to buying paddy and 76 percent reported disruptions to selling rice.
Along with the increase in COVID-19 disruptions came an increase in rice miller adaptations (Figure 2). The most common adaptation reported in October was a reduction in operating hours, implemented by 65 percent of mills, which is an increase from 42 percent in September. There was also a large increase in the number of mills that closed for at least one week as the government implemented stay-at-home orders.
For the first month since MAPSA began the surveys, safety measures to prevent COVID-19 were not the most common adaptation. The share of millers adopting safety practices was the same in October as in September (62 percent), declining from the level reported in August (71 percent). This is a surprising result given the recent large increase in confirmed COVID-19 cases and the strong government policy response in September and October. This may suggest some fatigue with safety behaviors as fewer mills are taking the necessary precautions to safely conduct business during the second wave of COVID-19 in Myanmar.
Rice and rice byproduct prices
As expected from the supply increase during the monsoon paddy harvest, paddy buying and rice selling prices in October declined compared with September. Paddy prices declined 20 percent on average whereas rice selling prices declined 6 percent on average.
Prices of the two main rice byproducts-rice bran and broken rice-also showed month-on-month declines in October. Rice bran prices fell by 17 percent on average and broken rice prices fell by 10 percent on average. These changes are likely driven by an increase in supply. However, both prices remain higher than at the same time in 2019.
Policy recommendations
Policies implemented to curb the spread of COVID-19 in Myanmar had adverse effects on rice millers at the onset of the 2020 monsoon harvest – a critical time for crop marketing. While actions must be taken to limit disease transmission across the country, the continued efficient and safe operations of rice value chains is crucial for both farm households and consumers. To respond to the above findings, MAPSA recommends the following two policy actions:
- Government should continuously and widely promote face coverings and social distancing not only to the public but also specifically to rice millers and other essential businesses. If general safety recommendations are ineffective, the government should employ a targeted communications strategy and provide industry-specific recommendations. Masks and distancing should be promoted to rice millers, farmers, and traders throughout the monsoon harvest period. Promoting the use of cellphones to conduct business would also improve safety.
- Government should work quickly to reduce any transportation restrictions at all administrative levels – including unofficial restrictions implemented at the sub-regional level. Where deemed necessary, the government should be decisive and transparent about what the restrictions are and when and how they will be enforced. Transit of monsoon crops and other essential goods and services should be given exemptions to allow more unrestricted movement, possibly through a special permitting system.
MAPSA is monitoring the impact of COVID-19 on key actors in Myanmar’s agri-food system. This blog post highlights one of the many recent surveys and policy notes that MAPSA has conducted to assess the emerging constraints that these key actors face and to mitigate the possible impacts of COVID-19 on rural livelihoods and food security. Additional blog posts are available highlighting MAPSA’s research on the impact of COVID-19 on key actors in Myanmar’s agri-food system. Surveys are ongoing, and findings and recommendations will be periodically updated.
Related blog posts
- How has the pandemic affected Myanmar's agricultural equipment retailers (November)
- How COVID-19 affects agricultural production in the Dry Zone (October)
- COVID-19's impacts on Myanmar's agri-food system
Joseph Goeb is a Research Associate in the Department of Agricultural, Food, and Resource Economics of Michigan State University, based in Yangon. Nang Lun Kham Synt and Phoo Pye Zone are Research Analysts in the Development Strategy and Governance Division (DSGD) of the International Food Policy Research Institute (IFPRI), based in Yangon. Yulu Tang is a Ph.D. student in Economics at Harvard University, based in the United States.
This blog post was prepared by Michael Wang, Mickey Leland International Hunger Fellow in DSGD of IFPRI, based in Yangon. The analysis and opinions expressed in this piece are solely those of the authors.
