Chavez threatens to nationalize rice production

AFP - President Hugo Chavez Saturday put Venezuela's rice processing industry under military control and threatened to nationalize any rice mill that halts production, after accusing them of shirking government price controls.

"We won't let them make fun of the people any more. They threaten with halting production; if they do that I'll expropriate all their factories," Chavez said at an outdoor session of parliament.

Rice processors threatened action after the government earlier this week took over an Alimentos Polar factory where it said 18,000 tons of rice was being stored, accusing it of selling mostly enriched rice to sidestep price controls placed on white rice.

Chavez said rice processing firms buy rice from farmers and then "don't want" to produce the price-controled variety.

He said some agro-industrial sectors "refuse to abide by the laws and regulations legally established... by the revolutionary government, especially those that process rice.

"I have ordered them placed under government intervention as of this moment," he said, adding that the National Guard would carry out his orders.

Food Minister Felix Osorio later struck a more conciliatory note, hoping rice processors would show "a modicum of conscience."

"We don't have any problem with the private sector keeping their means of production humming, but not from the capitalist point of view, because the people have needs. You can't see food as merchandise," Osorio said on VTV television.

Under Chavez's socialist agenda, the government last year nationalized part of the dairy industry, telecommunications and power companies, and since 2003 imposed price controls on staples including white rice.

Many food processing companies have complained the measure has dried up profit levels.