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From AsiaNewsOct. 27, 2010
Bangladesh: Rice yields down, prices up in Asia
Rice prices are up following drought and floods in many
rice-producing countries. A food crisis is in the making, like the one of 2008,
but governments appear to have learnt the lesson and are poised to cope with the
challenge.
Floods killed at least 162 people this month in Southeast Asia, damaging crops
in Thailand and Vietnam, the world’s biggest rice producers. This summer, floods
also devastated wheat production in Pakistan, whilst typhoon Megi lashed the
Philippines. In Russia and parts of eastern Europe, wheat production suffered
from the worst drought in 50 years.
The US Department of Agriculture lowered its estimate for global milled rice
output to 452.5 million tonnes on 8 October, 171,000 tonnes short of forecast
demand. The global production deficit, the first in four years, may be even
wider because typhoons and flooding hit Southeast Asia days after the USDA
released its estimate.
Rough-rice production from the main crop in Thailand, the world’s biggest
exporter, will “definitely” decline by an estimated to 1.5 million tonnes after
the worst floods in five decades inundated key growing areas, this according to
Prasert Gosalvitra, head of the state-run Rice Department. That would be a 6.5
per cent decline from last year’s main crop of 23 million tonnes. Actual losses
will not be known until floodwaters recede, he said.
Floods spread across 36 provinces in central, north and northeastern Thailand,
affecting at least 3.2 million people and damaging about 3.5 million rai (1.4
million acres) of agricultural area, the Department of Disaster Prevention and
Mitigation said in a statement today.
Official figures indicate that in Pakistan, floods damaged cultivation for 286.1
billion rupees (about US$ 2.36 billion), wiping out 2.39 million tonnes of rice.
Typhoon Megi, the strongest storm to hit the Philippines this year, affected 22
per cent of the 1.86 million hectares planted with rice, the Department of
Agriculture (DA) reported.
Losses reported from the DA’s local units have so far reached 468,546 tonnes,
about 6 per cent of the forecast fourth-quarter harvest, the Department said.
Rice prices are rising everywhere. In many countries, the authorities can resort
to reserves, but this means that next year prices will continue to rise because
the latter will have to be restocked.
In Bangladesh, rice prices are soaring as well, with the national staple food
now selling for 33 taka (US$ 0.47) a kilogram, almost double the price this time
last year.
When global food prices shot up in 2008, Bangladesh’s capital of Dhaka was
rocked by street protests as people queued for hours to buy cheap, low quality,
state-subsidized grain. When authorities sent trucks to sell rice at just 25
taka per kg during the recent Muslim holy month of Ramadan, they found few
takers for the poor-quality grain generally eaten only as a last resort.
According to experts, higher workers’ wages and foreign remittances allow people
to absorb price increases and turn down low quality government supplied rice.
Bangladesh, the world’s fourth-biggest rice producer, normally imports about 10
per cent of the grain it needs to feed its 150 million people. However, in 2007,
its monsoon paddy crop was devastated first by repeated flooding, then by deadly
Cyclone Sidr, which killed 3,500 people, displaced more than 2 million and
ruined 800.000 hectares of cropland.
During the food crisis of 2007-08, when rice prices doubled to US$ 500 a tonne,
big producers such as Vietnam and India imposed export bans to keep their
markets well supplied and domestic prices low. This triggered a shortage in the
overseas market where consumers hoarded and prices soared to a record high of
US$ 1,000 a tonne.
Since then, Bangladesh has learnt its lesson and has made self-sufficiency in
rice production a priority, with emphasis on the dry season crop, expanded
irrigation, improved distribution of high-yield seed, and subsidized fertilizer
for farmers. The results have been promising, with the dry season harvest rose
to 18 million tonnes from 14 million just a couple of years ago.
