To understand the effects of COVID-19 and political instability on Myanmar’s crop trade sector, researchers from the Myanmar Agriculture Policy Support Activity (MAPSA) conducted a phone survey of commodity traders in September 2021.
You can view the full research note in English here.
Background
Crop traders comprise the mid-stream of Myanmar’s food supply chain and serve as the essential link between farms and food processors, exporters, commodity exchange centers, and urban food markets. Thus, frictions and disruptions in the mid-stream caused by political instability and COVID-19 will likely affect both farmers–through market access and crop prices–and urban consumers–through food prices.
This blog post presents highlights of the results from a telephone survey of crop traders from Shan, Mandalay, Sagaing, and Magway conducted in late September 2021. The September survey is the eighth round of a panel that began in May 2020 to track the effects of COVID-19 on crop trade. This note presents a snapshot of the crop trading segment of Myanmar’s food supply chain shortly before the main monsoon crop marketing season. The objectives of the survey were (i) to continue to track key disruptions to crop trade; (ii) to provide detail on credit out to farmers and credit taken in during the 2021 monsoon season relative to 2020 and 2019; and (iii) to provide a snapshot of crop trader operations leading into the monsoon marketing season.
Trading disruptions and responses
The banking system difficulties are reflected in the high share of payments to suppliers made in cash (the following figure). Reliance on cash continued its upward trajectory since January with 89 percent of all crop purchases conducted in cash along with 86 percent of all crop sales–a large jump by 14 percentage points relative to May. In-person bank transfers–the leading payment method for selling prior to the banking sector collapse–have not improved since March and accounted for only 3 percent of purchases and 6 percent of sales transactions in September. For traders who normally make large transfers, mobile banking remains a problem since banks limit daily transaction amounts. Hundi payments have seen a sharp decline in sales since March and May. This may reflect high fees for Hundi payments amid the broader economic decline.
Payment methods for buying and selling by survey round, average percentage of payments
Following the third wave of COVID-19, traders were much more likely to implement preventative safety measures in September. For the first time since our surveys began during the first wave, all traders adopted at least one safety practice. The share of traders that practiced each safety measure increased from May, and face coverings (77 percent) and regular handwashing (61 percent) were the most common safety measures.
This blog post highlights one of the many recent surveys and research notes that MAPSA has conducted to assess the emerging constraints that key agricultural actors face and to mitigate the possible impacts of COVID-19 and recent disruptions on rural livelihoods and food security. Additional blog posts are available highlighting MAPSA’s research on the impact of disruptions on key actors in Myanmar’s agri-food system. Surveys are ongoing, and findings and recommendations will be periodically updated.
