"The next COTED will be a very nice, warm meeting..." says Jagnarine Singh, head of the Guyana Rice Development Board, in our lead story this week. He expects a full discussion on the subject of the continued attempts by Jamaican companies to get their hands on duty-free rice from outside the region at the expense of Guyana.
To be sure a few sharp words will be traded but one can safely predict that not much will come of it. Guyana's efforts to get its rice sold to a sometimes reluctant region have been going on for many years and will continue. Even now imports from outside the region are estimated to have a large share of the Jamaican and Trinidadian markets. For example Trinidad imported 12.43 million kgs of semi-parboiled rice from the US in 2003, its largest category of import. Jamaica in 2003 imported US$13.2M (CIF) worth of various types of rice and paddy compared to US$8.2M from Guyana.
Outgoing Assistant Secretary-General for Caricom, Byron Blake noted a few weeks ago that Caribbean countries are importing around US$2B a year in food products.
He urged policy-makers to make food production a priority as a means of reducing the growing food import bill.
That is why one can only be troubled by the Secretariat's waiver on 3000 MT of rice - worth US$700,000 - that was granted to the Jamaica Rice Milling Co, a firm owned by Archer Daniels Midland (ADM), a US-based grains giant which had revenues of US$30B last year and calls itself "The Supermarket to the World."
It also operates ADM/Barbados Mills Ltd and ADM/Belize Mills Ltd. In 1996 ADM was fined US$100M after senior ADM executives were indicted on criminal charges for engaging in price-fixing in the international lysine market. The Cato Institute notes that "at least 43% of ADM's annual profits are from products heavily subsidised or protected by the American government."
Is ADM in Jamaica to buy Caribbean rice or to promote subsidised US rice? ADM indirectly benefits from the huge subsidies paid to US farmers which were actually increased under the 2002 Farm Bill even as developing countries were calling for the end to supports. If you have the time, go to http://www.ers.usda.gov/Features/farmbill/analysis/ and gaze in wonder at the cornucopia of programmes provided for US rice and other farmers. (It makes you want to cry for the Guyanese farmer struggling with his taxed fuel and fertiliser.) These include direct payments worth up to US$40 per tonne, counter cyclical payments averaging $35 per tonne (in years when the price goes below a certain level), credit guarantees for exporters, conservation credits, marketing assistance loans and many other supports.
Now consider this: Jamaican companies actually imported 14,000 tonnes of rice from the US between August 20-26. This came at the direct expense of Guyanese and Suriname producers. Because of these developments one local miller/exporter is now suggesting it may not pay top prices to farmers, as its Jamaican market looks less certain. Cynical bargaining chip or not, farmers who have struggled mightily in recent years are always the ones to pay the price.
So while there might be some valid reasons why ADM's subsidiary so urgently needed 3000 MT of rice and could not access it here, one can't help feeling that by giving them the benefit of the doubt and issuing the waiver, the Caricom Secretariat is sending the wrong message.
For the record let's restate the key principles of the Treaty of Chaguaramas: these are to improve standards of living and work; the full employment of labour and other factors of production; and accelerated, co-ordinated and sustained economic development and convergence. It is hard to see how a waiver on imported subsidised rice reflects the spirit and intent of that treaty. Food security for the region is essential and encouraging agricultural production should be the mandate of all members, not only the net food exporters like Guyana but also importers.