By Grace Q. Bryant
The Ministry of Commerce and Industry has announced a sharp increment in the price of rice, the country’s staple food.
Minister Amin Modad, making the disclosure at MICAT’s press briefing yesterday, explained that the price of the 25kg bag of Indian parboiled rice will be increased from US$$16.50 to US$18.50 beginning Tuesday, May 21, 2024.
Modad said the increment is a result of 20 percent surcharges imposed by the Indian government on the specific type of rice preferred by Liberians, which had a significant impact on its cost.
Modad reassured the citizenry that the government is however working with authorities at Port to reduce the price of rice on the market, adding, “We have negotiated with the relevant parties to allow us to address all the concerns raised and those communicated to the previous administration, ensuring that we make the best decision for the people.”
According to Minister Modad, the priority is to minimize the cost for end users, stating, “We have insisted that if the price increase for a particular type of rice is to be considered, it must come with a commitment to offer several varieties of rice in the market for US$16.00 or less, which they have agreed to.”
The Minister added, “We have emphasized the importance of local rice production for our sustainability and self-sufficiency, and they have agreed to focus on local production instead of raising the price from 17 to 20 as initially planned.”
“As a temporary measure, we have agreed to a slight increase in the rice price for the new government, while we continue to work on a long-term solution. We have thoroughly scrutinized all the facts and have even confirmed with the Indian Ambassador, who verified the agreements made with the relevant parties,” he revealed.
He furthered that the main goal is to ensure that businesses can operate smoothly in the economy, maintain high standards for their food and products, and seamlessly integrate into the global market.
Meanwhile, Minister Modad said it is their responsibility to ensure that rice and other food products are not only available, but also affordable.
“Our team has conducted inspections of all warehouses to verify the rice stock, and it has been confirmed that we have approximately 120,000 metric tons available until the end of May. In order to prevent shortages, permits have been issued to Rising Motors to bring in rice. Furthermore, IPDs have been granted to enterprises in our effort to ensure availability,” he noted.
However, in a press release, the Ministry said this decision was made following discussions between it and the country’s leading rice importers, who cited uncontrollable and unfavorable external factors as the reason for the price adjustment.
The global factors that influenced this decision include disruptions in shipping routes through the Suez Canal due to the Ukrainian crisis, leading to increased shipping costs.
Accordingly, the Ministry is reporting that Indian government imposed a new 20% export tariff on the export of Indian Parboiled Rice (5%).
It said, in 2023, the Rice Importers Association requested a price increase to reflect the impact of external factors on the cost of rice importation but that said decision was postponed until after the 2023 Presidential and Legislative Elections. In February 2024, the Association resubmitted their request upon the appointment of Minister 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 US$16.75 on February 19, 2024.
At the time of the decision, 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.
The parties also agreed to conduct periodic reviews to determine the price of the commodity when necessary.
The importers 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 US$200,000 was announced during a meeting with the importers on May 17, 2024.
The Ministry said it welcomes the decision of the Rice Importers Association and assured Liberians that periodic reviews will always be conducted to determine the price of the rice.