The government has stepped in to aid farmers suffering income loss from a poor rainy-season harvest. The Ministry of Agriculture and Irrigation announced on January 14 a 20 percent increase in loans for the coming summer crop. According to the statement, which was carried in the state media, the increase – from K80,000 to K100,000 an acre – was agreed to help offset the fall in paddy prices caused by heavy flooding.

“The government will also extend the deadline for repayment of the rainy-season crop loan to March,” Dr Soe Tun, president of the Myanmar Farmers Association (MFA), told The Myanmar Times.

“This comes as costs and farm wages are rising. Farmers spend K140,000-K200,000 an acre for summer crops, so the loan is only a partial help. Farmers also borrow from private lenders, and pay high interest,” he added.

Farmers receive the loan from the Myanma Agriculture Development Bank at the rate of K50,000 an acre for rainy-season crops, K80,000 a acre for the summer crop and K10,000 for winter crop, which includes maize and beans and pulses, with an interest rate of only 1.3pc a month.

“MFA called for an increase in the loan for summer crops last December. MFA will ask the ministry to remove the borrowing limit, which is restricted to only 10 acres of paddy. We will try to get loans for all paddy fields in the coming crop,” he added.

Over the past two growing seasons, heavy flooding in the main rice production areas, Ayeyarwady and Bago regions, resulted in a crop below export standard, and prices have fallen.

“Farmers have to pay back loans, and lenders cannot borrow for the coming crop. Without profit from rainy-season crops, farmers can’t grow summer crop. On January 6, the farmers from Nyaungdon, Danuphyu, and Pantanaw townships wrote to the ministry to double the loan for winter crop from K10,000 a acre to K20,000,” said U Sein Win, a farmer from Pantanaw township in Ayeyarwady Region.

Link: http://mmtimes.com/index.php/business/3861-govt-boosts-summer-loans-by-20-percent.html