Thai rice looking good

[Guest]

Chinese growth feeds rice boom

 

09.06.2004

By ANUCHIT NGUYEN and ROB DELANEY

 

Seri Theparak, a rice farmer from northeast Thailand, used to have to beg local rice millers to buy his crop. Not anymore.

 

"They come to my house and offer a guaranteed price even before I start planting," said Seri, 40, who's buying a new US$8500 ($13,500) truck and 10 rai (1.6ha) more land to add to his 15-rai plot. "No farmer can remember that happening."

 

Seri and Thailand, the world's biggest rice exporter, are enjoying a boom fuelled by the demands of one country: China.

 

Thailand's rice exports to China more than tripled in the first four months this year.

 

Farmers from the US to India are benefiting from surging prices for the grain, with futures contracts for rice at a seven-year high, equivalent to US$253 a tonne.

 

Prices may rise further if China, the biggest producer and consumer of rice, becomes a net importer of the grain this year.

 

"We are in a new bullish trend because nobody believes that China can catch up in matching their domestic production to demand," said Mamadou Ciss, managing director at Ascot Commodities NV in Geneva.

 

China imported more rice than it exported only three times in the past 44 years, said David Dawe, an agro-economist at the International Rice Research Institute in Manila. World prices rose $160 a tonne when its import-export balances last tipped in 1995 and 1996.

 

China's future need for rice is "the million-dollar question", Dawe said. "It affects everybody who's importing and exporting rice around the world.

 

"The effects of even small price fluctuations on the welfare of producers and consumers, especially on the poor, can have political repercussions."

 

The shortage in China, where the economy grew 9.1 per cent last year, occurred for the same reasons as in 1995-1996, Dawe said.

 

"Rapid economic growth is leading to more jobs outside agriculture and, thus, labor shortages in agriculture."

 

Thailand is the only leading exporter with grain to spare, according to a report by the US Agriculture Department. All other major exporters will ship less than they did last season.

 

Vietnam, the world's No 2 exporter this year, blames cross-border smuggling of rice to China for a slump in supplies to state-approved traders. Rice prices have risen 20 per cent.

 

"The shortage in rice supply in Vietnam is largely because of the informal trade with China," said Nguyen Thi Nguyet, the Ho Chi Minh City-based general secretary of the state-owned Vietnam Food Association, which oversees all food companies.

 

India, the No. 2 exporter last season, is likely to cut exports by half, the US Agriculture Department estimates.

 

China's efforts to slow its economy may encourage more people to plant rice, said Dawe, but growing wealth meant fewer people ate rice.

 

Source: Honolulu Advertiser

 

HT

[jasmine]

Wonderful, it is about time that the Thai rice farmers get the fair share from their hard labor.

 

Jasmine

[btm1735]

It maybe wonderful for Thai farmer and I wish them well but this could be very negative for the poorest people in the world.

 

There is current scrap iron shortage due to the high demand in China (for the end product, steel). This may cut into the profits of GM or a small manufacturer such as myself. When it comes to a staple like rice, it can mean that some of the poorest in the world go hungry. Food aid is usually measured in dollars, pounds, whatever. Those dollars will be buying fewer tons of rice this year.