|
| Rice output in India to slump 18%: FAO official |
| Bloomberg / Oct 09, 2009, 00:52 IST |
|
Drought in India may slash rice output in the world’s second-largest grower by about 18 per cent this year, cutting global supplies available for importers, a United Nations official said.
“Unless there is a lot of rain that allows them to replenish the reservoir, even the coming crop will be affected,” Concepcion Calpe, senior economist at the UN Food and Agriculture Organization, said in an interview. “It will have an impact on trade next year.”
A reduction in exports from India, which already has a ban on shipments of non-basmati rice, is unlikely to spark another food crisis, Calpe said. Record global output last year helped countries boost inventories, which will fill a production gap, she said.
Still, “rice riots” may return to Asia next year if production losses in India and other Asian countries cause prices to surge, Peter McGuire, managing director at Melbourne-based investment firm CWA Global Markets, said on Thursday.
Protests broke out last year after export curbs by major producers including India, Vietnam and China raised fears of a food crisis. Global rice prices soared to a record as inventories declined, prompting governments around the world to secure domestic supplies as importers scrambled for shipments.
“At the moment, there is no evidence of supply shortages in the market,” Calpe said, adding that last year’s record prices were “not really triggered by shortages, it was an overreaction by governments and the market.”
Price spikes
Declining output in India “coupled with the recent weather issues in the Philippines will cause price spikes for the rice market toward the second quarter of 2010,” said McGuire of CWA, which offers warrant products in global commodity and stock index markets.
Rough rice futures on the Chicago Board of Trade reached a low of $3.52 per 100 pounds in April 2002 and surged to a record $25.07 in April 2008. Prices have almost halved since then after farmers around the world rushed to boost production to a record last year, replenishing stockpiles and averting a shortage.
Rough rice for November delivery gained for a fourth day on Thursday, adding 0.6 per cent to $13.30 per 100 pounds at 3:22 pm in Singapore.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
