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Get your facts right, Daukalia

19 August 2017
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Dear Editor – Please publish the following letter in response to that of Mr Henry A. Daukalia that appeared in your paper on Wednesday 17th August.

Dear Mr Daukalia, please sir, if you must publish statements about SolRice it would be much appreciated if you could get your research a little more accurate.

May I point out:

Never has SolRice sold a bag of rice at $220 as suggested. This is an outrageous claim and you may be getting confused with the price charged by the odd greedy retail shop, but their price is not controlled or determined by SolRice.

The port tariffs increased in some areas by 1100 percent. Other tariffs were created and were not a cost to importers or exporters previously.

These were not only a shock for importers, (and might I add hurtful to exporters) but these increases drove inflation and could not at the time be avoided.

You forget however Mr Daukalia, that we were also dealing with port congestion charges applied by the shipping companies at the same time which were substantial and a stronger US dollar, all contributing to our price position at the time.

It is unfair therefore by you to suggest as you do, that SolRice has been able to make substantial profits based on the prices you publish.

As an educated person, you will be aware SolRice margins (as should be the case all other rice importers), are controlled by the Commerce Commission.

We cannot exceed the maximum margin allowable, and for your further education, SolRice has never in my time, ever reached the maximum margin allowed for us due to competitive and cost pressures and economic conditions.

Therefore, please note our current pricing is due to better currency exchange levels, no congestion fees currently being charged by the shippers which was a cost created by a poorly operating port under your hero's guidance, a renegotiated and improved supply chain set of costs including lower rates from farmer to port and significantly, a further reduction in SolRice margins to meet consumer and competitor challenges in an economy that is clearly struggling.

Finally, again I need to update you on facts regarding your last paragraph.

SolRice has only this week been proud to be involved in further discussions with the very highest level of Government with regards to a domestic rice crop and where we can support this program into the future.

Mr Daukalia, I hope this helps clarify the real position and opens up some fundamental understanding of how pricing not only works but is also controlled to ensure food security for this country where SolRice have been proud to ensure that food security remains a top priority for our company who have guaranteed it for the last 40 years, stayed in the country to ensure it remained secure, even during the Tension period, and were able to source massive quantities of rice under urgency as the Australian rice crop failed in recent times, all to ensure we did not put food security at risk.

I hope the Chinese companies you refer to at the end of your letter will be proud enough and able to claim the same in 40 years time also?

By the way, despite the increase in cheap imports and competitive price points at the bottom end of the rice category, driving our margins to be squeezed even more tightly, SolRice has just invested in a huge increase in full time permanent employees, up by 75%.

We now employ either directly or indirectly on site over 60 personnel and indirectly through associated businesses linked to our brand, we support another estimated 600 to 800 people making a livelihood from our brands SolRice has a buy locally policy, securing as many products and services locally as possible and importantly, SolRice invests well over $1 million a year in community support and sponsorships, aimed at improving in various ways the lives of the people of the Solomons.

I hope the companies you hold highly and clearly support in your final paragraph can also say the same.

You know and I know Mr Daukalia, they cannot.
 

Nick Ellis
General Manager
Solomon Rice Company Ltd

 

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