Record rice yield expected, but prices will rise: UNMay 13th, 2008 - 7:33 pm ICT by admin
New York, May 13 (IANS) Rice production in Asia, Africa and Latin America will reach record highs in 2008, but prices could also continue to rise in the short term, the United Nations Food and Agriculture Organisation (FAO) has said. Harvests will surge by 2.3 percent and reach an all-time high of over 600 million tonnes, but prices will remain high in the near future because a large portion of this year’s crop will only be harvested at the end of 2008, according to FAO.
However, the UN agency warned that the destruction of Myanmar’s food basket by the Cyclone Nargis earlier this month could lead to a worsening of the global rice production outlook.
The cyclone, which flooded rice-growing areas and destroyed several warehouses and stocks, hit Myanmar as paddy farmers were harvesting their dry season crops, which account for 20 percent of the country’s annual rice production.
Prices of rice in Yangon, former capital city of Myanmar, have jumped by 50 percent, and if the country turns to neighbours such as Thailand and Vietnam for imports, this could lead to a further upwards pressure on global prices.
According to the FAO Rice Price Index, international prices soared by 76 percent between December 2007 and April 2008.
“Prices are expected to remain extremely firm, at least until the third quarter of 2008, unless restrictions on exports are eased in the coming months,” said FAO rice expert Concepcion Calpe.
Major rice exporters, including India, have recently set export bans, taxes or ceilings to prevent shortages in their own countries.
“These measures further restricted the availability of rice supplies on international markets, triggering yet more price rises and tighter supply conditions,” Calpe said.
Only Thailand, Pakistan and the US are the leading exporters, selling rice overseas without any constraints.
Rising prices of fertilizers, pesticides and fuel are also contributing to the rise in prices of rice.
Average rice consumption worldwide is predicted to go up by 0.5 percent to 57.3 kg a year, and despite the rising prices of rice, consumers are shifting away from more expensive foods, such as meat and meat products.
The price rise has revealed other medium-term limitations, including the low level of investment in agriculture and limited funding for agricultural research, FAO said in a news release Monday.
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