Liberia News: A Cartel!

…Commerce Minister Describes Rice Industry

Monrovia-May-22-TNR:The Liberian Government through the Ministry of Commerce and Industry is said to be getting uncertain with the rice importers of Liberia on its decision to increase the price of Liberia’s staple diet.

Minister Amin Modad addressing the media in Monrovia recently, termed the rice industry as a cartel. According to the former Unity Party National Chairman now Minister of Commerce, the government has not been able to get any rice in the country by the importers.

He disclosed that the government through his Ministry has verified all of those constraints the rice importers have listed. “We can reduce some cast from this side, and we are working on them,” he indicated.

Speaking further, Minister Modad added, “On Friday we received a letter from the rice importers informing us that, they had made up to negotiate, they had a major stuck of rice but due to the cast on all they have a factor in the cast of rice, they could not afford to sell for US$16. 75 and are still requesting the government to bring it to US$20 for a bag of rice.

Minister Modad asserted that the government through his office had had several meetings with them over the last few days with the rice importers in finding a solution to such request.

Liberia’s staple food, rice is seeing an increase in the price of this “political commodity,” some four months after President Joseph Nyuma Boakai’s Unity Party (UP) came to power.

The Commerce and Industry Ministry Monday announced an increase in the price of the 25kg bag of Indian Parboiled Rice (5% Broken) from US$16.75 to USD$18.50. Commerce Minister, Amin Modad, told Journalists Monday that the only way to prevent increase in rice price from abroad is for Liberia to begin producing its own rice locally.

In a press release, the Ministry said this decision was made on Friday, May 17, 2024, following discussions with leading rice importers in the country. These importers cited uncontrollable and unfavorable external factors as the reason for the price adjustment.

News of this latest increase in the price of rice has begun to worry many who think this will further worsen the already difficult financial and economic situation of ordinary citizens.

Annually, Liberia is said to import over US$200 million worth of rice mainly from Asian countries, despite its vast area of fertile soil.

The government has attributed the latest increase in the price of rice to global including disruptions in shipping routes through the Suez Canal due to the Ukrainian crisis, leading to increased shipping costs. Additionally, the Indian government imposed a new 20% export tariff on the export of Indian Parboiled Rice (5%).

According to the Commerce Ministry, in 2023, the Importers Association requested a price increase to reflect the impact of external factors on the cost of rice importation. However, the decision was postponed until after the 2023 Presidential and Legislative Elections.

It says in February 2024, the Association resubmitted its request upon appointing the Minister of Commerce and Industry, Amin Modad, following constructive discussions between the Ministry and the importers, the price of the 25kg bag of Indian Parboiled Rice (5% Broken) was reduced to USD$16.75 on February 19, 2024.

The Commerce Ministry also says that when the decision was made, the country had 120,000 Metric Tons of the 25kg bags of Indian Parboiled Rice (5% Broken) in stock, expected to last for the next three to four months, with new orders due in May and June. To provide citizens with more affordable choices amidst the global changes impacting rice prices, the Rice Importers Association agreed to distribute an alternative rice variety at a lower price, committed to investing in local rice production through the Ministry of Commerce and Industry’s Value Addition Program, aiming to support local farmers, reduce dependence on imported rice, and boost the national rice reserve as a buffer against external shocks. An initial investment of USD$200,000 was announced during a meeting with the importers on May 17, 2024.

Meanwhile, the Commerce says it welcomes the decision of the Rice Importers Association and assures the Liberian people that periodic reviews will always be conducted to determine the price of the rice.

This investment in local rice production is expected to reduce the country’s reliance on imports and enhance the national rice reserve as a precaution against external shocks, says the Commerce Ministry press release.

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