The price of corn rallied to K1,170-1,190 per viss in the domestic market as the FOB corn prices rise to US$290-310 per tonne, according to Yangon Region Chambers of Commerce and Industry (Bayintnaung Commodity Depot).
Myanmar conveys corn to China and Thailand through the border and also sent corn to China, India, Viet Nam and the Philippines by maritime shipping at present, according to the Myanmar Corn Industrial Association.
China is purchasing Myanmar’s corn through cross-border trade under the opium substitution program. Legitimate corn trade between Myanmar and China commenced at the end of 2022. A total of 112 companies have been given the green light for legitimate corn exports.
Thailand gives the go-ahead to corn imports under zero tariff (with Form-D), between 1 February and 31 August. However, Thailand imposed a maximum tax rate of 73 per cent on corn imports to protect the rights of their growers if the corn is imported during the corn season of Thailand. There is only over one month remaining to export Myanmar’s corn to Thailand under the Form D customs tariff benefit.
The directive released on 30 June 2022 said that transactions for the exports of agricultural products including corn, rice, bean and oil crops are to be made in dollars instead of Yuan-Kyat/Baht-Kyat. Therefore, 65 per cent of export earnings (US dollars) of the corn have to be exchanged according to the reference rate of the Central Bank of Myanmar (K2,100). The CBM eased the foreign currency conversion order to 50 per cent from 65 per cent for the exporters on 13 July 2023, according to its notification 15/2023.
At present, the CBM sets the reference exchange rate at K2,100 whereas the US dollar is transacted at K3,300 in the grey market, showing a large gap between the reference exchange rate and the grey market rate.
Myanmar exported over 2 million tonnes of corn to foreign trade in the 2022 corn season. The majority of them were sent to Thailand and the remaining went to the Philippines, China, India and Viet Nam.
More than two million tonnes of corn are expected to be shipped to foreign trade partners in the 2023 corn season, said U Min Khaing, chair of the Myanmar Corn Industrial Association.
The corn is cultivated in Shan, Kachin, Kayah and Kayin states and Mandalay, Sagaing and Magway regions. Myanmar has three corn seasons — winter, summer and monsoon. The country produces 2.5-3 million tonnes of corn every year. – NN/EM
