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| Asia's food security hinges on rice grower India |
| AP/PTI / Cebu /Philippines Oct 29, 2009, 14:42 IST |
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Rising rice prices and possible shortages in the world's poorest countries will hinge on what major growers India, China and Thailand do to make up for millions of tonnes of the staple lost to floods and droughts.
All eyes are on India, traditionally one of the world's top rice exporters, which may import 1.1 million tonnes to 3.8 million tonnes next year to replace production losses after a drought ravaged the country's rice bowl.
"Just the fact that India has significantly reduced production alone is a significant development given the tightness of supplies that we see in the world today," said Jim Guinn, vice president of USA Rice Federation.
"But the fact that they may actually be an importer is of even more importance," he said.
India's return to the import market is viewed as pushing up the price of benchmark Thai 100 per cent Grade B rice, which this month traded at $530 per tonne, though still down from more than $1,000 at the height of last year's food crisis.
Guinn said other factors include whether China will export or not, and if Thailand releases its bumper stocks.China holds half the world's rice stocks and has been exporting on-and-off.
"The circumstances are there certainly for another panic in the marketplace," Dwight Roberts, president and CEO of US Rice Producers Association, said at an international rice conference.
India may also turn to wheat, which remains relatively cheap, as a short-term solution to its lower rice production, said Jeremy Zwinger, publisher of The Rice Trader, which monitors the industry.
But India's shift to wheat consumption may not be enough to stop the country from importing, Roberts said.
"In Asia, if you don't eat rice, you don't eat," he said. "Rice here is a religion as much as a food product."
The 2008 rice crisis demonstrated that the crop "is a very political commodity", Roberts said.
Last year's record-high price of rice and other staples led to riots in at least 30 countries, according to the World Food Programme. The biggest producers, Thailand, Vietnam and India had curbed exports to protect domestic supply.
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