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September 18, 2020

NEWS
TRADING

Greek offer for Myanmar sugar draws interest

Greece has offered to buy sugar from Myanmar at US$400 per tonne per month on a free on board (FOB) system. The offer has sparked interest in the industry, as under FOB, the buyer will take delivery of the commodity as soon as the shipments leave the supplier’s shipping dock. Local traders consider these terms favourable.

It is the first time Greece has offered to import sugar from Myanmar since the government permitted the import and re-export of sugar to boost trade volumes in 2015.

In the past, sugar was mainly re-exported to China. However, to curb concurrent illicit exports that were taking place at the border, China placed a limit on sugar import volumes from Myanmar, and eventually banned all imports in September 2017, leading to the current glut.

Current, there are nearly 500,000 sugarcane farmers working for 23 sugar factories in the country. The farmers have also requested that government limit sugar imports as long as there is a surplus. Sugar imports have since been restricted. Although sugarcane is usually ground and processed in November, the local sugar factories started this year’s grinding process in December.

Source: Myanmar Times

Prices, sales of watermelons plunge dramatically

Photo - EPA

Traders are reporting that Myanmar’s watermelon crop, which is largely dependent on the China market, is currently experiencing a major downturn.

Watermelon have dropped by around 50 percent while sales have declined by as much as 99 pc in the Muse border trade area in Shan State. Normally, in Muse at this time of year some 600 to 700 merchants from China come every day.

Yangon Region government recently helped to arrange sales of watermelon at the Myanmar Ethnic Culture Festival and Danyingone Wholesale Market in Yangon.

Watermelon prices have dropped from between K5,000 to K3,000 to between K3,000 to K1,500. Agronomist are advising farmer to control the harvesting of their crops, but it can only delay around 10 days and after that farmers face damage to the crops.

The Melon Growers, Producers and Exporters Group is urging local buyers to help farmers by buying more of the crop.

Source: Myanmar Times

Myanmar to hedge against slower China trade due to coronavirus

Loaded trucks with industrial goods wait to pass from China to Myanmar at the Kyegaung border gate, in Ruili, Yunnan province. Photo - EPA

Myanmar wants to expand its exports to other markets to hedge against a potential dip in demand from China, where a new respiratory virus has infected more than 14,000 people and killed more than 300, mostly from Hubei province, where illnesses from the new type of coronavirus were first detected in the city of Wuhan in December.

China is now Myanmar’s largest export market. Already, trading of melons has come to a standstill and prices have halved. As such, preparations are being made for Myanmar to send more goods to other markets to avoid any volatility in demand from China.

Plans have also been made to export more goods via air and maritime routes to offset slower trade at the border.

Since the outbreak of the coronavirus, China has stopped importing melons from Myanmar and stockpiles of fruit are being held in Yunnan province. Around 80 percent of total border trade takes place at the Muse trade gate on the Myanmar-China border. Disease preventive measures are also being carried out at the border gate to prevent the coronavirus from spreading into Myanmar. Border trade volume between Myanmar and China amounted to US$1.6 billion between October 1 and January 24 of the current fiscal year.

Source: Myanmar Times

Melon trading at border halted amid coronavirus fears

Related imageMyanmar watermelon traders have begun to feel the pinch of the coronavirus outbreak as Chinese buyers have stopped showing up at border crossings to buy their produce. 26 Chinese buyers failed to turn up as usual at Muse border gate in Shan State, leaving 200 trucks of watermelons and muskmelons without buyers.There are restrictions in Yunan province on gathering at parks and restaurants.

Travel is allowed within the province but not outside.Watermelons are bought mostly by traders from other provinces in China, not from Yunnan.Other traders expressed grave concern over the possibility that Myanmar would impose restrictions on Chinese citizens if the outbreak continues to grow.Many people rely on the border trade, which is worth millions of US dollars. Now health is more important. If Myanmar restricts the entry of Chinese people, it could damage our livelihoods.Watermelons fetch between 2,000 yuan and 3,800 yuan per tonne, while muskmelons sell for 3,000 yuan to 5000 yuan per tonne. Golden honeydew melons fetch up to 4,300 yuan per tonne.

Myanmar has been exporting melons to China since 2005, and last year exported about 800,000 tonnes. Melons rank 17th among the country’s exports, rank 8th among the country’s crops, and are the top fruit export, generating about US$100 million annually. The government recently developed a five-year plan to increase melon cultivation and exports.

Source: Myanmar Times

Sino-Myanmar border trade up $573.6 mln in current fiscal

Image result for Sino-Myanmar border trade Sino-Myanmar border trade registered an increase of US$573.668 million between 1 October and 17 January in the current financial year. Data from the ministry shows the value of Sino-Myanmar border trade rose to $2 billion in the current fiscal from $1.46 billion recorded in the year-ago period.This FY, the value of border trade totaled $1.67 billion at Muse, $33.89 million at Lweje, $188.4 million at Chinshwehaw, $140.87 million at Kanpiketee, and $2.878 million at Kengtung.

In a bid to lower trade barriers and offer relief to Myanmar traders through the border trade channel, officials from the Ministry of Commerce, the related departments, and the Union of Myanmar Federation of Chambers of Commerce and Industry have been negotiating with their Chinese counterparts. During Chinese premier Xi Jinping’s recent visit to Myanmar, Myanmar and China signed MoUs on Local Cooperation under the Framework for Joint Building of the China-Myanmar Economic Corridor (CMEC) between the Yunnan Province of China and the Mandalay Region of Myanmar, Protocol on Plant Inspection and Quarantine Requirements for Exporting Rice From Myanmar to China, Protocol for Heat Processed Cocoons to be imported from Myanmar to China, Protocol on Quarantine Health Requirements for Slaughter Bovine to be Exported from Myanmar to China, Exchange Letter for the Project of Agricultural Product Quality Control Centre, , and many other agreements.

The two countries are making efforts to set up more border economic cooperation zones and promote border trade.Following the MoUs between Myanmar and China, bilateral trade will grow, said a market observer.Myanmar exports rice, sugar, pulses, sesame seeds, corn, dried tea leaves, fishery products, minerals, and animal products to China, while it imports agricultural machinery, electrical appliances, iron and steel-related materials, raw industrial goods, and consumer goods from the neighboring country.

Source: Global New Light of Myanmar

Mon State a sweet spot for maritime trade, tourism

Image result for Mon State a sweet spot for tradingMaritime trade and tourism in Mon State can level up with better transport and power supply, according to a property market report.Yangon-based Picon-Deed Property Consultants released its study this month on Myanmar’s southern state highlighting how its mineral and natural resources, booming tourism industry and geographical location can capture investments and regional trade.

Mawlamyine, the state capital, and Kyaikhtiyo, commonly known as the Golden Rock, are popular tourist destinations, attracting a growing number of local and foreign visitors. Kyaikhtiyo is the star attraction but Mawlamyine, with its striking riverfront boulevard and diverse downtown area, was not far behind.The fourth most populous city in Myanmar, Mawlamyine is home to the 72-room Hotel Suggati. The waterfront five-storey hotel is owned by Singapore-listed Memories Group, and provides conference rooms, working spaces, a fitness centre and a restaurant

Mawlamyine needs to establish a reliable electricity supply in order to become a hub for value-adding activities to a wide variety of commodities. The state has large plantations of rubber along the Yangon-Mawlamyine Highway but gas-fired power stations have potential for scale up. A number of retail centres can already be found in Mawlamyine compared to other second tier cities. The state government held an investment fair last December to attract foreign and local businesses to invest in agriculture, fisheries, tourism, trade and logistics, manufacturing and infrastructure sectors.The location of Mon State means there is strong potential to leverage on the trade channels with Vietnam, Laos, Cambodia, and Thailand.

Source: Myanmar Times

Mineral exports up $532 mln in current fiscal

Image result for Mineral exports up $532 mln in current fiscalMyanmar’s mineral exports were registered at US$832.42 million between 1 October and 10 January in the 2019-2020 financial year, showing a remarkable increase of $532.027 million compared to the year-ago period. Last year, mineral exports were pegged at just $300.39 million.

Both private and public sector mineral exports witnessed an increase in the current FY, with the private sector exports valued at $378.39 million and public sector exports estimated at $454 million. Of the seven export groups, exports of agriculture, minerals, fishery, and finished industrial goods showed an increase, while the exports of livestock, forest products, and other goods declined.Export values stood at $998.7 million for agricultural products, $48.32 million for livestock, $288.2 million for fishery products, $48.4 million for forest products, over $2.75 billion for manufactured goods, and $93.97 million for other goods.

The country’s export sector relies more on the agriculture and manufacturing sectors. While export earnings from the CMP (cut, make, and pack) garment businesses are rising, the country’s reliance on natural resources such as natural gas and jade has been lessening. Due to limited extraction of natural resources, exports of forest products and minerals dropped significantly in the previous year. Permits for mining blocks were suspended in 2016, but after a period of two years, Myanmar’s mining sector has now been opened to local and foreign investors.

Source: Global New Light of Myanmar 

Local-made lotus towels find market in Japan

Image result for lotus towel MyanmarJapan is the largest buyer of towels woven with lotus thread. Pan Organic Wear is buying the thread derived by the residents from lotus stalks of the plants thriving in Soanye Inn lake near Soanye village in Kyaukse Township as raw material for the industry. The company is selling a towel woven with lotus and silk at over K 100,000 and with pure lotus at over K 400,000.

Fabrics made of lotus thread are too rare.They can cool you down in summer and warm you up in winter. Besides, they are light and easy to wash.Most Myanmar people wear the lotus towel around the next as a muffler, but foreigners typically wrap it around the waist as a longyi. Six person have to work through the difference stages of weaving for three consecutive days to produce a lotus thread towel. Unlike the imported cloths, lotus thread fabrics are rare commodity which takes time to produce one.

Pan Organic Wear is also producing longyis (man’s sarong) dyed with natural agents, apart from lotus thread towels, with the strength of 20 workers. It is also producing new generation weavers, according to local sources.The company buys a viss (3.6 pounds) of lotus thread between Ks 300,000 and Ks 400,000 depending on the quality. The lotus season begin in April every year.

Source: Global New Light of Myanmar

72 firms registered for retail, wholesale services: Commerce Ministry

Image result for retail businessThe Ministry of Commerce (MOC) recently announced that it has issued registration cards to 72 trading firms providing retail and wholesale services.Thirty-four wholly foreign enterprises from Thailand, Japan, the Netherlands, the US, China, Singapore, Switzerland, Malaysia, Poland, the Republic of Korea, and Germany have been granted registrations, along with 11 domestic businesses owned by Myanmar citizens and 27 joint ventures, according to the ministry.

With the recent reforms in the retail sector, domestic retailers said they are seeking a level playing field against foreign players.Foreign businesses and joint ventures are now allowed to carry out wholesale and retail businesses in Myanmar. This liberalization might affect the market share of local manufacturers.At present, domestic retailers are facing difficulties in keeping up with the reforms in the retail and wholesale sector as they do not control the whole supply chain.

Retail shops need to link with many suppliers and find ways to offer lower prices to customers.Proper supply chain management is important for retailers of any size as it can lower the price and give them a competitive advantage in the market, he said. Foreign investments can play an important role in the development of the country and create better jobs for local people.Thus, the country also needs to bring about investment opportunities and provide incentives to foreign investors, while promoting foreign investments.

Source: Global New Light of Myanmar

Natural gas exports up $150 mln in two months

Related imageMyanmar’s exports of natural gas over the past two months of the current financial year amounted to US$579 million, an increase of about $150 million compared with the corresponding period of the 2018-2019 fiscal, according to the Commerce Ministry.The increase in the value of exports is linked to the rise in the price of natural gas in the global markets.

Natural gas is included in the list of major export items of Myanmar.Total natural gas production from inland blocks and offshore blocks in the third year of the incumbent government’s rule is estimated at 623.838 billion cubic feet. Natural gas extracted from the field is exported to China.The Yadana natural gas project is being carried out by the TOTAL Company, with its pipeline supplying natural gas to Thailand. Natural gas is also extracted in Yedagon, located offshore from Taninthayi and discovered in 1992. The Zawtika Project in the Gulf of Moattama mainly supplies natural gas to neighboring Thailand.Production at Yadana and Yedagon is declining, and those projects will be halted in the coming years.

The Yadana, Yedagon, Zawtika, and Shwe gas projects are expected to collectively produce over 630 billion cubic feet of natural gas in the 2019-2020 fiscal year.There are over 104 oil and gas blocks in Myanmar: over 51 offshore blocks and 53 inland blocks.Myanmar’s exports of natural gas in the previous financial year totaled $3.88 billion. Meanwhile, heavy enterprises such as offshore oil and gas and mining projects will enter the country.

Source: Global New Light of Myanmar

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Thae Oo Myintzu
MMRD Insight—Editor
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