Source: Kaieteur News
04/05/2014 – The Guyana Rice Development Board (GRDB) has defended its multi-million-dollar deal with neighbouring Venezuela yesterday saying that the costs are the best available on the market.

There have been suggestions that a US$56 per tonne freight cost was too high. It left rice farmers with less for their paddy.

A story by Kaieteur News, two Sundays ago, quoted industry sources as saying that a middleman may have received millions for just facilitating the shipments. GRDB is the body charged with overseeing the rice industry in the country.

However, GRDB through a statement issued by the Ministry of Agriculture said that the rates paid by GRDB for freight is consistent with what have been and are presently charged.

The statement accused the newspaper of attempting to create a false impression but admitted that the US$56 charged in addition to freight, would also include demurrage rates, loading and discharge conditions, among other things.

GRDB also complained that the US$12 per tonne on wharfage fees is a non-negotiable price determined by the Shipping Association of Guyana.  “We would like to pay a cost that is much lower and we urge our friends at Kaieteur News and its ‘insider’ to join us in our advocacy with both shipping and wharf companies for a more favorable price,” the statement said.

Regarding a US$3 per tonne pay to a company, Rice Lab, to ensure that the quality of rice shipped to Venezuela is acceptable, it was stressed that Guyana must meet the specifications of various markets.

Venezuela, GRDB said, has an established standard for white rice and paddy. They also require monitoring of these standards relating to quality and weight at the loading ports, but contractually require that these be done independently of GRDB and the Government.

“The Venezuelan buying company, LACASA, contracted a Cuban company called ‘Cuban Control’. The cost of $3 per tonne is not negotiable by GRDB but established through this contracted arrangement.”

GRDB said it is merely a mechanism intended to safeguard the market and is imposed on GRDB through a contractual obligation.

GRDB insisted that there is no middleman involved in the deal to hire the ships used to take the rice and paddy to Venezuela.

“The Kaieteur News stories sought to imply that GRDB inappropriately engage middlemen in its arrangement with Pacific Chartering Services Inc. Houston Texas, Alexander and Balke Limited, General Agents Reliance Shipping Ltd. Denmark, Shiptrade Panama s.a. Panama, Sea Trade Link S.A. Panama, Global Sea Carrier S.A. Panama, Guyana Intership Agency; Georgetown and Nova Scotia Manufacture Company Ltd. Georgetown.”

GRDB insisted “unequivocally” that no middleman have been involved in putting the arrangements together.

Kaieteur News had been told that a former prominent rice miller, Mahadeo Panchu, had been involved in the arrangements for shipments. He was reportedly let go a few crops ago.

“As stated these arrangements are in accordance with the Standard Operating Procedures (SOPs) and we would want Kaieteur News and its ‘insider’ to tell us who these alleged middlemen are.

These and other misrepresentations by Kaieteur News are intended to create friction between the Board and other stakeholders within the rice industry.”

GRDB said that the truth is that it had with the Government of Guyana facilitated a trade and ensured that the industry, particularly rice farmers, derive maximum benefits.

“We remind everyone that prior to the Venezuelan market being concretized, farmers were paid an average of $2000 per bag. Since 2010 when the Venezuelan market emerged, farmers have received in excess of $3500 per bag of paddy. We continue to invest monies to improve the industry and to strengthen our markets.”

GRDB believed that the “insiders” were actually persons who sought to have unfair advantages and benefit disproportionately from the Venezuelan market.

“Our efforts to ensure the benefits of a preferred market are fairly distributed have caused some players to resort to misrepresentation and Kaieteur News and Stabroek News have been eager to take such ‘hearsay’ stories and cast aspersions on the GRDB.”

The rice initiative, finalised in 2009 by former President Bharrat Jagdeo with Venezuela’s late leader, Hugo Chavez, has been a major one for Guyana.

Initially viewed with suspicion by farmers, the Venezuelan rice market has become a lucrative, secure one, at least for the time being.

GRDB has until August to complete the shipments. Under what is known as the Petro Caribe deal, Venezuela supplies oil and would be repaid in goods. In Guyana’s case it is rice.

Last year, Guyana’s rice production broke the all time production record reaching 535,000 tonnes.
This year, the target is 540,000 tonnes.

Source:http://www.kaieteurnewsonline.com/2014/05/04/grdb-defends-shipment-cost-for-venezuela-destined-rice/