AGRI BUSINESS IN MYANMAR

Agricultural development is a top priority for Myanmar. The sector is a major source of income for the country, employing 62.4% of the labour force and contributing 26% of GDP and 16.4% of Myanmar’s total export earnings.
With its abundant land and water resources, diverse agro-climatic conditions, open borders, limited regulation and low wages, predictions for growth of agriculture and agribusiness on both demand and supply sides are excellent.
As with other developing nations, challenges to agricultural investment in Myanmar include limited modern infrastructure, and underdeveloped legal and banking systems.  

Overview

With international trade sanctions lifted, Myanmar is rapidly embracing the outside world. It is a member of the WTO, ASEAN, BIMSTEC, GMS and ACMECS. Regional markets are also being opened by new trade agreements, connecting Myanmar to fast growing economies on its borders.
The government has embarked on a program of policy reform that has liberalised most markets and opened space for the private sector, both domestic and foreign. Myanmar has also increased investments designed to accelerate the pace of agribusiness and agro-industry development.
The nation is strategically located for export markets, straddling the border between South Asia, Southeast Asia and China, home to more than 3.6 billion consumers.
Myanmar agriculture has been changing from subsistence economy to commodity oriented commercial farming, and the expansion of agribusiness companies (ABCs) has taken place rapidly. Land areas bought or leased by such entities went from 225,242 acres in 1999 to 2.3 million acres in 2013, though only 23.9% of this land has been developed so far.
Industry bodies are also emerging in the newly liberalised market. The Union of Myanmar Federation of Chamber of Commerce and Industries (UMFCCI) is promoting the development of agriculture, industry, trade and service.
Other development–oriented business associations include: The Myanmar Agro-based Food Processors and Exporters Association (MAFPEA) which is helping to ensure food safety and upgrade national food standards; and the Myanmar Rice Industry Association (MRIA), serving as a partner to the government to help re-establish the rice industry as a world leader.
The association of Myanmar Rubber Planters and Producers (MRPPA) is also working to increase the country’s natural rubber production and to upgrade product quality in order to compete with regional and global markets. 

Opportunities and challenges

Strengths for the Myanmar agribusiness sector relative to other countries are: diverse agro-climatic conditions, abundant fertile land, long coastline (about 3,000km), plentiful water resources, and a strategic location for exports to China, India and ASEAN.
There are huge potential for processing plants (rubber, palm oil), agri-based industries (soybean, wheat, maize, baby corn, sugarcane, legumes), and input industries (seeds, agro-chemicals).
Lack of well-advanced government strategy, poor infrastructure (such as roads, internet and electricity), an under-developed banking system and a relatively unskilled labour force are some of the issues facing agribusiness in Myanmar.
Myanmar is still dependent on exporting raw commodities (rice, pulses, maize, sesame, rubber, etc.) rather than the production of value-added or finished products. Moreover, almost all of agricultural export items received relatively lower prices due to quality concerns. Both upstream and downstream industries are underdeveloped along with low public and private investment, technology, and human resources.

Myanmar government incentives 

·         Corporate income tax exemption for three consecutive years after commercial production
·         Exemption or reduction of tariffs and domestic taxes on machineries, parts etc. imported relating to plant construction
·         Exemption or reduction of tariffs and domestic taxes on imported raw materials for the first three years, which are to be used for commercial production immediately after completion of construction phase
·         Exemption or reduction of income tax on a maximum of 50% of profit gained from export of products
·         Accelerated depreciation of fixed assets
·         Grant of rights to deduct R&D expenses from assessable income
·         Carry forward and set of losses for up to three consecutive years from the year the loss is sustained

Investment opportunities

Dairy Industry

·         Dairy cattle population: 0.5 million head of dairy cattle/buffalo (about 5% of total cattle/buffalo population)
·         Breed: Cross breeds of Friesian, Sindhi, Thari in cattle and Murrah in buffalo.
·         Herd size: more than 90% of farmers are small holders (less than 20 cows)
·         Dairy products: Fresh milk (major product), condensed milk and pasteurized milk
Domestic market demand:
·         People like tea and coffee with condensed milk
·         Milk powder is used for infants (imported)
·         Some amount of condensed milk, dry milk is imported
 Investment opportunities:
·         Dairy cattle farming
·         Milk processing plants (condensed milk, evaporated milk, milk powder)
·         Biogas production and inorganic fertilizer production
·         Favourable domestic market

Beef Cattle

·         Breeding Centres
·         Breeding Farms
·         Abattoirs for beef cattle
·         Meat processing plants
·         Frozen beef for export
·         Farm equipment
·         Animal Vaccine Production
·         Regional export markets

Other livestock

·         Pig breeding and processing
·         Goat breeding
·         Poultry hatchery
·         Poultry breeding and meat processing
·         Production and distribution of animal feed and supplement

Livestock facts and figures:

Livestock population in Myanmar 2012-13

Livestock

Number in Thousands

Cattle

14,560

Buffalo

3,207

Pig

11,431

Chicken

194,221

Sheep

884

Goat

4,351

Duck

16,775

Production (2013-13)

Product

Unit

Volume

Cattle

Metric Ton

275,930

Buffalo

Metric Ton

668,120

Pig

Metric Ton

1,156,710

Chicken

Metric Ton

1,818,980

Egg

No. in Thousand

8,997,150

 Per capita consumption in Myanmar

 

2010-2011

2011-2012

2012-2013

2013-2014

2014-2015

2015-2016

Meat (kg)

32

33

35

38

41

45

Milk (kg)

26

27

28

30

32

35

Egg (number)

127

133

141

150

162

174

 

Fisheries

Inland fisheries sector
·         Leasable fisheries 
·         Open Fisheries (lake, river, flooded area)
Marine fisheries sector
·         In-shore fisheries
·         Off-shore fisheries
Aquaculture sector
·         Fish
·         Prawn/ Shrimp
·         Crab/soft shell crab
·         Seaweed
Post-harvest and service sector
·         Landing site/wholesale markets
·         Processing plants
·         Ice plants
·         Dock yard service
·         Long line fishing
·         Net factory
·         Food testing/auditing service
·         Fresh food packaging and canning 

Fisheries facts and figures

Fish production

Year

Total

Culture

Leasable

Open

Marine

2002-03

1595.87

252.01

109.53

180.61

1053.72

2003-04

1986.96

400.36

122.28

331.98

1132.34

2004-05

2217.47

485.22

136.79

366.75

1228.71

2005-06

2581.78

574.99

152.69

478.43

1375.67

2006-07

2859.86

616.35

170.10

548.09

1525.32

2007-08

3193.92

687.67

191.05

625.44

1689.76

2008-09

3542.19

775.25

209.72

689.71

1867.51

2009-10

3921.97

858.76

237.46

764.97

2060.78

2010-11

4139.14

816.82

248.44

913.12

2160.76

2011-12

4478.21

898.96

282.64

963.82

2332.79

2012-13

4716.20

929.36

290.00

1012.97

2483.87

Unit: '000MT

 Myanmar fish exports

 

2002-2003

2003-2004

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

MT (1000)

213

205.5

255.8

271.1

343.4

351.7

324.7

375.1

373.9

387

376.9

USD (M)

317.4

318.5

346.9

359.2

466.2

561

483.2

496.6

555.5

653.9

652.8

 

Horticulture  

Beans and pulses 
·         The leader in bean and pulse production among ASEAN nations
·         Second largest sown area after rice (4.45 million ha)
·         18 kinds of pulses are grown
·         Sown in rainy season and winter season
·         Sagaing, Mandalay and Magway are major regions for pulses
·         Major export item (75% of agricultural export value)
·         Most of the pulses grown in Myanmar are for export
·         Important vegetable protein source for the daily consumption of Myanmar people
·         Some pulses grown for green manure, soil conservation and by-products are valuable for animal feed and fuel
Downstream Industries
·         Cleaning
·         Grading
·         Sorting
·         Polishing
·         Splitting (with skin, without skin)
·         Food processing (Roasted, fried, flour, pasta, soup, canning, etc.)
·         Oil extraction (soybean)
·         Sprouting
·         Animal feed
Investments
·         Upgrading and modernization of processing facilities
·         Storage and logistics
·         Market development
·         Research and development
·         Certification
·         Information services
Input industries
·         Seed industries
·         Fertiliser
·         Pesticides
·         Agri-machinery
·         Irrigation

Other papers available upon request 

·         Plantation Land availability and Utilisation in Myanmar
·         Agro-based Food Processing License and Food Standard Policies in Myanmar
·         Food Security in Myanmar and Neighbouring Countries
·         Prospects of Agricultural Trade in Myanmar
·         Utilisation of Land to Improve Competitiveness
·         Water Management for Agribusiness Development in Myanmar
·         Highlights of the Draft National Seed Policy for Myanmar
·         The Status and Potential of Agricultural Mechanisation in Myanmar
·         Business Opportunities for Bio-Fertiliser Industries in Myanmar
·         Algae Production and Processing as A Contribution to Rural and National Development
·         The Role of MADB in Agricultural Finance
·         Current Legal and Tax Issues in Myanmar Agribusiness Sector
·         The Role of Industrial Parks in Myanmar Agribusiness Sector
·         Revolution in Agricultural Mechanisation in Myanmar
·         Oil Palm – A Golden Crop