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Bounced cheques: GRDB suspends licence of Mahaicony Rice Mills

Jun 26, 2008 News

The Guyana Rice Development Board (GRDB) yesterday suspended the licence of Mahaicony Rice Mills after the group of mills allegedly continued to issue bounced cheques to farmers.
A GRDB statement from General Manager, Jagnarine Singh, last evening said that the group will no longer be able to manufacture or export rice because of its continued unprofessional business conduct in the industry.
“They continue to issue cheques to the rice farmers that are being ‘referred’…” the statement explained.
GRDB said that while the group of mills continued to mill and export rice, they are not paying the farmers as agreed.
“This nonpayment to the farmers is causing a delay in the sowing of the second crop and can lead to less than the projected acreage being sowed.
Consequently this will result in a reduction of the production and nationally in a reduced GDP contribution from the rice industry,” GRDB said.
Under the amended Factories Act, rice mills are not allowed to owe farmers more than five per cent of their gross sales.
A rice official said that the Mahaicony Rice Mills would purchase an estimated 500,000 bags of paddy per crop which translates to over $1.2 billion dollars.
Several farmers reportedly visited the banks over the past few weeks and while some were paid, others learnt that there was no money in the account.
The Alesie Group recently received their licences after it was suspended for a year because of alleged non-payment as well.
Rice prices on the world market are at the highest because of the shortage of grains fueled by climate factors and farmers abandoning food crops to grow crops for bio-fuels.

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