|
HONG KONG: The soaring price of rice has triggered a supply and
demand crunch that is hurting some of Asia’s neediest nations,
forcing them to spend more on imports, industry experts and
officials say.
For the likes of Thailand and Vietnam, the
world’s two biggest exporters of the grain, the rising demand is a
money-spinner with rice now selling at more than $500 a ton in
Bangkok and nearly as much in Hanoi.
But from Bangladesh to the Philippines, from
India to Indonesia, the squeeze is bad news as they seek to balance
cost with the imperatives of feeding hungry populations and averting
social chaos.
“Every Asian government is well aware of the
close relationship between political stability and the stability of
the rice price,” Jonathan Pincus, the UN Development Program’s
chief economist in Vietnam, told Agence France-Presse.
“So every government in the region will be
doing all it can to maintain price stability, particularly for basic
food grains.”
At the end of February, Thailand’s benchmark
rice was trading at more than $500 a ton, a rise of more than $100
from a month earlier and up from just $325 a year ago.
Exporters in Vietnam meanwhile were setting
prices at $460 a ton last month, the state news agency VNA said—up
more than 50 percent from a year ago.
“It’s a global issue. All cereal prices are
going up,” said Andrew Speedy, the UN Food and Agriculture
Organization’s Vietnam representative.
“This is quite serious. It’s hurting
everybody, especially the poor.”
In the first two months of 2008, Vietnam’s
rice exports brought in $150 million, an increase of 78 percent from
a year ago.
Much of the output is destined for the
Philippines, whose President, Gloria Arroyo, asked Vietnamese Prime
Minister Nguyen Tan Dung last month to guarantee stable supplies.
Unable to meet its own needs, the Philippines
will import up to two million tons of rice this year, according to
the government.
Last year its harvest was 6.44 million tons,
National Food Authority spokesman Emmanuel Salonga said, but it
needs 11.8 million a year.
“Our population is growing and arable land is
being converted to other uses so we cannot cope with demand,” he
said.
Indonesia’s rice production has been outpaced
by its population growth for more than a decade, said Mangara
Tambunan from the country’s Center for Economics and Social
Studies.
“The government has to open the door to more
imports. It should not be so reticent,” he said. Last year,
Indonesia imported 1.5 million tons.
To ensure stability, a government agency buys
and releases stocks and sets import duties. Heavily subsidized rice
is also sold to millions of the poorest families, yet even those
prices are rising.
“They’re trying to get producers to sign
long-term contracts,” the UNDP’s Pincus said, referring to
Indonesia and the Philippines.
“But who’s going to sign a long-term
contract now for rice deliveries when prices are rising so quickly
and so steadily? No one wants to be left without adequate stocks,
and that contributes to driving up the price.
“They’re willing to pay a higher price for
future deliveries because they don’t want to be caught short.”
In Bangladesh, which has a population of 144
million, the price of rice has doubled in a year, vastly outpacing
income levels, said Ruhul Amin, deputy head of the government’s
food planning unit.
“People are cutting all their other spending
to focus only on food,” Amin said, but with 40 percent of the
population relying on a dollar a day or less, the poorest are
struggling to survive.
This year Bangladesh will need to import some
three million tons because of damage caused by floods in mid-2007
and November’s devastating cyclone.
Some of that is coming from neighboring India,
but otherwise New Delhi has halted exports of non-basmati rice to
keep its own domestic prices in check.
India allowed the export of 3.2 million tons of
non-basmatic rice in the first half of the current financial year,
but since October no new contracts have been signed.
The move has upset the All India Rice
Exporters’ Association. “Farmers react to high prices by
producing more,” said its president, Vijay Sethia. “Restricting
trade just distorts the price signal.”
For now, some nations appear insulated against
rising prices. China, Japan and South Korea are largely
self-sufficient and protect their rice sectors via steep import
tariffs or heavy subsidies.
-- AFP
|
