‘Rice industry nearing collapse’ - MP raises high costs, corruption concerns

‘Rice industry nearing collapse’ – MP raises high costs, corruption concerns

Apr 07, 2026 News

(Kaieteur News) – The rice sector in Guyana is teetering on the brink of collapse, according to We Invest in Nationhood (WIN) MP Gobin Harbhajan, who has raised concerns over soaring production costs, shrinking markets, alleged corruption and questionable decision-making.

He identified several contributing factors, a major concern being that more than 70% of land under rice cultivation is reportedly owned by individuals residing overseas and rented to local farmers at high rates. The rental income is often converted to foreign currency and remitted abroad, limiting the availability of funds for reinvestment in the sector, including the purchase of machinery and agricultural inputs.

“This high cost has a crushing impact on the farmers’ profit margin and, by extension, the entire industry,” Harbhajan said in a recent press statement. He noted that farmers also face high operational costs, particularly for irrigation as significant expenses are incurred to pump water multiple times during crop cycles. This persists despite substantial financial allocations to the National Drainage and Irrigation Authority (NDIA) under the Ministry of Agriculture, with concerns raised about the effectiveness of measures to reduce production costs. Additionally, he said labour and machinery costs continue to place heavy financial pressure on farmers, making it difficult to maintain profitability and stable livelihoods.

‘Rice industry nearing collapse’ - MP raises high costs, corruption concerns

WIN Member of Parliament Gobin Harbhajan

Harbhajan said these combined expenses have driven production costs to levels that reduce Guyana’s competitiveness on the global market. While major rice-producing countries such as India, Thailand, Bangladesh, and Vietnam are able to sell rice at approximately US$350 per metric ton, he observed how Guyana’s production costs make it difficult to sell below US$500 per metric ton, limiting its attractiveness to buyers.

Harbhajan further pointed out that the industry has also seen a sharp decline in rice milling operations. “In 1996, there were over 72 rice milling operations in Guyana. Today that number has shrunk dramatically to just 12 active rice mills across the nation. In fact, some millers are unable to pay the rice farmers because there is limited market to sell the rice to bring an income for the millers to make payments to the farmers,” he said, adding, “This bleak situation is clearly a vociferous public call for instant remedy. And to rescue the industry from greater calamity, nothing other than a complete overhaul of the system with all its officials is mandatory.”

Harbhajan continued that Guyana has also lost a significant export market in Europe, which previously accounted for a large share of rice exports. This decline has been linked to concerns over food safety standards, particularly the presence of chemical residues associated with the pesticide imidacloprid, which has been banned. Despite these challenges, he said concerns have been raised about the continued use or importation of such chemicals.

Alternative markets have not fully compensated for these losses, he said, and while Cuba remains a buyer, its capacity to make timely payments is limited, and Caribbean countries import relatively small quantities, often sourcing rice from more competitively priced suppliers.

The situation, he observed, has raised concerns about the long-term stability of the rice industry and its impact on the economy. He called for urgent and comprehensive reforms, with emphasis on government responsibility to implement effective policies, support farmers, and ensure the sector remains viable and competitive.

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collapse, corruption, Gobin Harbhajan, high costs, rice industry

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