CNI News

18 July 2022

Although rice exports to China dropped , broken rice increased in border trade recently, according to rice merchants in Muse.

In the past, Myanmar exported much more rice than broken rice to China but rice exports dropped to 10 percent of previous volumes while broken rice stored in warehouses in Muse was sold to China, Vice Chairman U Min Thein of Muse Rice Commodity Exchange told the CNI.

“Merchants exported broken rice instead of rice to China. In the past, Larger volumes of rice were sold to China but broken rice exports were much more  than rice recently . Only one truck out of ten transported rice  to China and the rests were broken rice trucks. Broken rice from the mainland as well as from warehouses in Muse was transported through Kyin San Kyawt gate.

Broken rice is used as a substitute for rice in distilleries and production of noodles and vermicelli in China.

Merchants in China import more broken rice than rice because taxes for rice are higher than that for broken rice, according to U Min Thein.

“Taxes for broken rice are lower in China while that for rice is higher. So, it is more profitable for them to import broken rice. They have to pay 20 Yuan more taxes for a bag of rice,” he told the CNI.

As it is not so profitable for Myanmar merchants to export rice due to the gap between the official exchange rate of the Central Bank of Myanmar and market exchange rate, the volume of rice exports to China dropped.

Exports of rice from Bayint Naung Commodity Exchange to China also decreased, Secretary U Than Oo of Bayint Naung Commodity told the CNI.

“Exporters completely stopped buying rice and only a small volume of rice was exported to China through Kyin San Kyawt gate. Muse-105 mile gate has been closed,” he said.

About 10 to 15 truckloads of rice and broken rice are exported to China through Kyin San Kyawt gate daily.

As merchants exported more broken rice than rice recently, a small volume of rice entered Bayint Naung Commodity Exchange recently.