Myanmar suspends rice exports to control price

AP News
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Posted: Mar 03, 2011 6:49 AM
Myanmar suspends rice exports to control price

Myanmar has suspended rice exports in an effort to keep prices down while also grappling with higher fuel costs due to the turmoil in OPEC member Libya.

A rice exporter says the suspension began in the last week of February, and apparently seeks to ensure rice prices are not driven higher by shortages. He spoke on condition of anonymity because discussing the matter could draw official disapproval.

The U.S. Department of Agriculture had projected that Myanmar would export about 500,000 metric tons of rice this year, far behind neighboring top-exporter Thailand's 10 million tons, but enough to make it the world's 10th biggest exporter after Argentina and Brazil.

Myanmar's ruling junta, which is supposed to hand over power to an elected but military-dominated government soon, is aware that political unrest can be triggered by economic factors such as rising living costs.

The junta came into power in 1988 after violently suppressing vast pro-democracy demonstrations which followed discontent triggered by currency changes that invalidated most bank notes. Similarly, the roots of major protests in September 2007, also violently quashed, were in small-scale demonstrations demanding lower commodity prices after a knock-on effect from a sudden big rise in fuel prices.

Local fuel prices have recently gone up due to the unrest in Libya and other Arab countries, with a gallon of diesel fuel selling for 4,000 kyat ($4.55) this week, up 11 percent from the previous week.

As commodities such as food are distributed around the country, higher transport costs are reflected in the goods' final costs for consumers.

The government in the past held a monopoly on sales of fuel, which it also subsidized, but it privatized gas stations in June last year.