By Marion Ali
A shipment of three containers with 75 tons of “Grade A” rice, imported from Guyana by businessman Jack Charles (Jitendra Chawla), to retail cheaper than local rice, arrived at the Big Creek port, Stann Creek on Thursday morning, but will remain there, at least for now.
Charles was not allowed to off-load the rice since he does not have an import permit from the Belize Agricultural Health Authority (BAHA). But Charles says he applied for the permit in July and still hasn’t received it. Thus he could not present formal documentation to the Belize Customs Department.
At a press conference on Thursday, Charles, accompanied by Technical Consultant, Sergio Garcia, provided a receipt he received when he applied for the rice through his company, Xtra House. He told reporters BAHA informed him verbally that he would not be granted the permit but did not offer a reason for the refusal. Garcia said when a permit is rejected, it is normally given in writing so the applicant can appeal the decision. To date, Charles still hasn’t received a written response informing him of the refusal or a reason for it.
But while Charles has produced a receipt from BAHA, Jose Alpuche, Ministry of Agriculture CEO said publicly this week that when he checked Tuesday, “no permit request had been made to BAHA.” Even so, Garcia pointed out that the Supplies Control Act of Belize states that any product from CARICOM does not require an import license.
Article 150 of the Treaty of Chaguaramas makes provisions for the importation, on the condition that Charles stays within 20 percent of the entire country’s market demand. He has committed to importing 20 percent, stating that he is only providing a superior quality product at a reasonable price for the poor.
Prior to Charles showing his receipt, the Belize Chamber of Commerce and Industry (BCCI) weighed in on the matter, advising that “all required permits are to be applied for and issued in advance of importation, not when the product is sitting at the border.”
The Chamber was also concerned about how the importation of the rice will affect local farmers and Belize’s rice industry. “The matter is more than just about the price of rice. Rather, if the importer is proposing to displace the livelihood of at least 20 percent of our Belizean rice farmers, there must be a commitment to following the requisite procedures in the proper order, so as to safeguard the safety of the consumer in the long term, and to prove that the quality and standards justify the social and economic loss to Belize”, the BCCI continued.
As has been reported, Charles’ “Grade A” rice would retail for 69 cents per pound, compared to the locally-produced “Grade C” rice, which currently sells for as much as $1.25 per pound. The difference is significant, and just this month, the Government made good on a promise several months old, to lower the price of “Grade C” rice. It in fact, came up with a new classification and pricing schedule for locally produced rice. The commodity is now categorized in four groups: Extra Premium, “A” and “B”, all of which producers will have the freedom of selling at whatever price they choose, as long as the public supports those prices. The “C” class rice, which sells now for up to $1.25 per pound, is the only one that will have a controlled price of 90 cents per pound, when the new regime takes effect on December 23rd . It contains 30 percent broken grains.
Under the new regime, rice will be packaged, labelled and priced accordingly by the Belize Marketing and Development Corporation, which buys rice paddy from farmers then dries and mills it before selling the finished product to grocers.
Reginald Jackson, a Toledo rice farmer who produces 150,000 pounds of rice per year, told the Reporter to produce a pound of rice costs about 22 cents. He then sells rice paddy (unshelled rice) at a maximum 10-cent profit, at 32 cents per pound to the BMDC, which adds a cost after it dries, mills and distributes the product in 100 pound and 20 pound sacks to retailers. There is also another mark-up for transportation and packaging in smaller amounts before it reaches shelves.
Charles challenges local producers that if they can lower their prices to around 60 cents per pound, he would reconsider importing the rice. But that is something easier said than done, according to industry insiders. Stanley Rempel, CEO for Circle R Products told the media that in Guyana, “they have free infrastructure. They have free water. They have cheap financing. They are not taxed at the front of the production cycle, whereas we are taxed at the front of the production cycle. So there is a lot of factors that they are just disregarding.”
While there is no shortage of locally produced rice, Jackson said in previous years he produced almost double what he produces today, but trying to finance loan commitments and cover overhead expenses out of installment payments from the BMDC rather than in one payment, cripples the business. He shared similar views as Rempel and said if rice farmers could get their own equipment duty-free or subsidies for fuel and fertilizer, they could sell for even cheaper than 32 cents per pound to the BMDC.
As for the rice that sits at the Big Creek port, Charles has seven days to either produce a permit or it will start to accrue storage costs. If the seven days expire, Charles will have three months to sort out a way of getting a permit, or the product will be auctioned off or disposed of.