Burma - Country Commercial Guide
Agriculture

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2021-09-27

Overview

The agriculture sector is one of the most important sectors for the country’s economy; agricultural goods are Burma’s second-largest export commodity.  The sector normally contributes nearly one-third of the country’s GDP, accounts for 20 to 30 percent of total export earnings, and employs more than 70 percent of the workforce.  A total of 12.8 million hectares out of 67.6 million hectares of land in Burma are cultivated.  Rice is the country’s primary agricultural product, which accounts for nearly 43 percent of the total agricultural production value.  In Burma, 70 percent of the country’s population live in rural areas and their livelihood drives the agriculture sector as an important growth engine of rural development.

According to the 2021 April published United States Department of Agriculture (USDA) Grain and Feed Report, the Burmese military’s February 1, 2021 coup will negatively impact agricultural trade at least in the short-term due to the country-wide Civil Disobedience Movement, which involves widespread labor strikes in opposition to the military’s action.

In 2021/22, rice production in Burma is forecast to recover planting acreage in anticipation of favorable weather, high prices incentive set by the government and potential exports to China and other countries within the Association of Southeast Asian Nations (ASEAN). In 2020/21, rice production decreased due to insufficient amounts of irrigated water.  The government reported that the second rice crop area in 2020/21 could also be reduced due to lack of irrigated water.  Burma’s overall rice exports in the past two years were forecast to fall due to complications from COVID-19 (2019/20) and the unstable situation after the February 1, 2020 military coup (2020/21).  However, overall rice exports are projected to increase four percent in 2021/22 after recovering from both crises.  Following the Chinese president’s visit in January 2020, the two countries brokered a bilateral broken rice agreement, significantly increasing broken rice exports to China.  In 2020/21, the domestic prices for rice are expected to grow due to low domestic production, probable panic buying, and limited transportation and other logistics following the military coup.

In 2021/22, Burma’s corn production is projected to increase due to surging demand from Thailand, China, the Philippines, Vietnam, and India and a high price incentive regardless of the coup.  In 2020, Burma’s feed demand declined 30 percent due to reduced domestic demand for meat and poultry due to complications from the COVID-19 pandemic.  The livestock industries sought to resume normal operations in August 2020 but were again impacted by a second, more serious wave of COVID-19.  The government continues to ban corn imports to protect local farmers.

Wheat production in Burma is forecast to be flat in 2020/21 and 2021/22 due to a lack of price incentives in line with low domestic demand.  Domestic prices for wheat decreased 10-15 percent in 2020 due to low domestic demand during COVID-19. Burma’s wheat imports and consumption are forecast to decrease in 2020/21 due to closures of bakeries, coffee shops, and restaurants to prevent the spread of COVID-19 and the unstable situation following the February 1 coup.  While U.S. wheat exports to Burma have been growing with significant market share gains,

Burma mainly imports wheat grain from Australia, Canada, the United States, and Ukraine.  Australia supplies 40 percent of Burma’s total wheat grain imports largely due to preferential duties granted under the ASEAN-Australia-New Zealand Free Trade Area as well as lower prices than U.S. wheat.  Under the ASEAN Australia-New Zealand Free Trade Agreement, Australian wheat benefits from duty-free imports in 2021, which will likely facilitate increased Australian wheat imports in 2021/22.

Burma’s agricultural exports include rice, maize, black gram, green gram, pigeon pea, chickpea, sesame, onion, tamarind, raw rubber, vegetables, and fruits.  Burma’s major import items in the agricultural sector are power tillers, hand tractors, fertilizers, pesticides, herbicides, diesel oil, dumpers, loaders and spare parts, water pumps, hydraulic excavators, gearbox assemblies for hand tractors, rod and mild steel, and hybrid and quality seeds.

Leading Sub-Sectors

Agricultural Machinery and Equipment:  Currently, Burma depends on traditional manual labor and lacks the advanced technology needed to produce value-added finished goods.  There is market potential for U.S. manufacturers of agricultural equipment and farm machinery.  Machinery used in the assembly and manufacturing of light to heavy agricultural machinery, power tillers, walking tractors, water pumps, sprinklers, drip irrigation sets, transplanters, threshers, seeders, weeders, dryers, and farm storage facilities are all in demand. 

Fertilizer:  Burma has a very competitive fertilizer market compared to other ASEAN countries, and the fertilizer industry is attracting a growing number of foreign investors.  Fertilizer is one of the most imported items in this sector; Burma imports about 80 percent of chemical fertilizers from China and Thailand, estimated at between 1.2 and 1.4 million tons per annum.  The country produces less than 15 percent of fertilizers domestically and does not have a competitive advantage in fertilizer production at this time despite having natural gas as a resource for ammonia production.  

Opportunities

Other sub-sectors with good prospects for business opportunities are chemicals production, transport, storage, wholesale, processing, and agricultural services, contract farming, irrigation system and facilities, farm industry, research and development, value-added production, packaging industry for local agricultural produce, warehouses and cold storages facilities, service support for supply chain, microfinance and trade finance services for local farmers.

U.S. companies are advised to conduct proper due diligence checks on local partners. The U.S. Commercial Service Office offers customized services that help U.S. businesses find reputable local business partners.

Contact Information
U.S. Commercial Service Burma
Ms. Ummay Aiman
Commercial Specialist
Email: Ummay.Aiman@trade.gov