Southern Riverina ricegrowers have welcomed a paddy price increase which sees the second payment for the 2011/12 crop valued at more than $50 million.
The overall paddy price for medium grain rice was increased by $20, to $280 a tonne, last week.
The second of six payments from the 963,000 tonne crop, which was harvested in April this year, was increased to $55 a tonne and brought forward to October 30.
It was originally planned to be paid to growers on November 20
Ricegrowers Association (RGA) vice president and Berriquin RGA Branch president Warren Lang said the early and increased payment was a welcome bonus for local rice growers.
‘‘In my role I have received calls from quite a mixture of young rice growers starting their career, right through to older growers,’’ he said.
‘‘It’s a particularly difficult time as farmers are waiting for cereal crops.’’
Mr Lang said farmers were still cash strapped from the 10-year drought — which only broke two years ago — and that the timing of the payment was perfect.
‘‘The timing is the most important thing,’’ he said.
‘‘Quite a few had approached banks in relation to increase carry-on payments.
‘‘But thanks to the payment this may not have to be used. There is much pleasure in receiving the payment.’’
Mr Lang said the increase has injected some much needed positivity into the industry, saying it had been ‘‘considerable years since I have seen something like this’’.
‘‘In particular it’s good for the community,’’ he said.
‘‘Local businesses should get paid. It’s a huge boost to the community.’’
Mr Lang said it also points to SunRice ‘‘getting back on track’’.
The payments are being made to ricegrowers based on the 963,000 tonnes harvested in April this year.
Last week, SunRice announced a strong financial year has allowed the company to increase the return price for the 2011/2012 harvest by $20, to $280.
The total payment is averaged out over six instalments, with this second payment worth about $55 per tonne and delivering almost $53 million to growers.
The first payment, paid at harvest, delivered $145 per tonne, and the remaining $80 in the estimated pool will be delivered through additional payments in February, April, May and July.
Rice growers were originally only expecting to receive about $22 per tonne for the second payment.
SunRice chairman Gerry Lawson made the announcement of an increase to shareholders and growers, saying the continuation of good trading conditions for the Australian Rice Milling and Marketing business had made it possible.
Mr Lawson said given SunRice’s improved cash flow position, the company had also decided to bring forward the second paddy payment.
‘‘We hope the early payment will assist growers at a time when rice planting and winter crop harvest place considerable demands on cash flow,’’ he said.
In the same announcement, SunRice said it anticipated that its consolidated net profit after tax (including minority interests) for the half year ending October 31 would be more than 15 per cent above the result achieved for the same period in 2011/12.
SunRice’s half year accounts will be finalised and released in December 2012.
The outlook for rice in the 2012/13 season is looking ‘‘good’’, but the volatile world economy could impact on returns next year, according Deniliquin RGA Branch president Nick Morona.
‘‘But generally it looks quite positive,’’ he said.
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