Bangladesh, other three countries to buy less rice on good harvest
Monday, 27 April 2009
FE Desk Report
Bangladesh, Indonesia, the Philippines and Turkey are foreseen to buy less after harvesting good crops, according to Food and Agriculture Organisation (FAO)'s latest forecast.
In contrast, Afghanistan, China mainland, the Islamic Republic of Iran, Iraq, the Democratic Republic of Korea, Saudi Arabia, the United Arab Emirates and Yemen are expected to import more, often to cover production shortfalls, but also to reconstitute national food reserves, it notes.
The global rice trade in 2009 is expected to marke a rise against that of the previous year. At the same time, there will be an increase in world imports influenced by low prices relative to the previous year, the forecast says.
The forecast indicates that world rice trade in 2009 now points to a volume of 31 million tonnes, 200 000 tonnes more than in 2008, but still short of the 2007 record.
It, however, sees much uncertainty as to the effects of the downturn of the world economy on the volume and nature of rice transactions in 2009. Given more difficult access to credit and lack of confidence over the financial situation of trade players, one possible effect could be an intensification of barter and government-to-government deals, it witnesses.
Regarding imports it indicates the increase in world imports in 2009 is likely to be sustained by low prices. Asian countries are expected to absorb 48 per cent of the total in 2009, or 14.8 million tonnes, marginally more than in 2008. In the wake of the excellent 2008 paddy crops, rice imports in Africa may decline by 3 per ent to 9.3 million tonnes, which will be the lowest volume since 2004.
Imports in Latin America and the Caribbean are now set to hover around 3.5 million tonnes in 2009, up 3 per cent from last year. Of these, 2.4 million tonnes are anticipated to be directed to Central America and the Caribbean, mainly Cuba, Haiti, Mexico and Nicaragua.
In South America, imports may rebound in Brazil, Bolivia and Colombia. In North America, Oceania and Europe, import prospects in 2009 are mixed. Australia may need to step up its purchases, while those by the EU may reach a record 1.5 million tonnes. By contrast, the United States may cut its imports.
FAO's latest prospects point to a level of world paddy production in 2008 of 683 million tonnes (456 million tonnes, milled rice equivalent), 23 million tonne, or 3.5 per cent more than in 2007 and the fastest growth since 2005. The increase would be based on a 2.2 per cent rise of the area to 159 million hectares, a positive reaction to high prices and to government support. Favourable growing conditions also boosted average paddy yields by 1.3 per cent to 4.3 tonnes per hectare, despite soaring costs of fuel and fertilisers, and difficult access to quality seeds. Much of global production gain is expected to be concentrated in Asia but, with impressive increases foreseen in Africa, the region looks set to make an important contribution to world expansion in 2008.
FAO notes that the 2009 paddy season has already started in southern hemisphere countries. Although too early to draw a global production forecast, prospects are positive in Indonesia, but still uncertain in Madagascar and Mozambique where the cyclone season has already started.
Continued shortages of irrigation are again limiting plantings in Australia to well below normal. In South America, little growth is currently anticipated in Brazil while drought depressed planting in Uruguay. In Argentina, the area has increased but drought may affect yields.
Large supply availabilities in the traditional exporting countries are set to foster a small increase in global rice exports.
The expected lifting of export curbs in Egypt and India in May 2009 will also help boost trade. Among the various sources, China, India, Myanmar, Pakistan, Viet Nam and Egypt are forecast to increase their exports, more than offsetting lower expected deliveries by Brazil, Cambodia, Thailand and the United States, FAO observes.
It notes, one outcome of the 2008 global production surge is expected to be a strong rebuilding of world rice stocks carried over 2009, now forecast to reach 118 million tonnes, the highest since 2002 and 9 million tonnes more than in 2008.
Globally, reserves in 2009 will be sufficient to cover 25.8 per cent, or roughly three months, of planned utilisation in 2009, up from 24.4 per cent in 2008. The higher value of the stock-to-use ratio is indicative of an improved level of security, as far as rice is concerned, at the world level. The forecast points out that much of the stock build-up is expected to be concentrated in exporting countries, and especially in China and India, which hold the largest rice reserves, but also in Egypt, Pakistan, Thailand and Viet Nam. Traditional importing countries, such as Indonesia, Sri Lanka, Saudi Arabia and the United Arab Emirates, are also foreseen to increase the size of rice inventories.
Since reaching peak levels last May, world rice prices have steadily declined until December 2008, reflecting a retreat of importers and the harvesting of large 2008 main paddy crops since October.
Bangladesh, Indonesia, the Philippines and Turkey are foreseen to buy less after harvesting good crops, according to Food and Agriculture Organisation (FAO)'s latest forecast.
In contrast, Afghanistan, China mainland, the Islamic Republic of Iran, Iraq, the Democratic Republic of Korea, Saudi Arabia, the United Arab Emirates and Yemen are expected to import more, often to cover production shortfalls, but also to reconstitute national food reserves, it notes.
The global rice trade in 2009 is expected to marke a rise against that of the previous year. At the same time, there will be an increase in world imports influenced by low prices relative to the previous year, the forecast says.
The forecast indicates that world rice trade in 2009 now points to a volume of 31 million tonnes, 200 000 tonnes more than in 2008, but still short of the 2007 record.
It, however, sees much uncertainty as to the effects of the downturn of the world economy on the volume and nature of rice transactions in 2009. Given more difficult access to credit and lack of confidence over the financial situation of trade players, one possible effect could be an intensification of barter and government-to-government deals, it witnesses.
Regarding imports it indicates the increase in world imports in 2009 is likely to be sustained by low prices. Asian countries are expected to absorb 48 per cent of the total in 2009, or 14.8 million tonnes, marginally more than in 2008. In the wake of the excellent 2008 paddy crops, rice imports in Africa may decline by 3 per ent to 9.3 million tonnes, which will be the lowest volume since 2004.
Imports in Latin America and the Caribbean are now set to hover around 3.5 million tonnes in 2009, up 3 per cent from last year. Of these, 2.4 million tonnes are anticipated to be directed to Central America and the Caribbean, mainly Cuba, Haiti, Mexico and Nicaragua.
In South America, imports may rebound in Brazil, Bolivia and Colombia. In North America, Oceania and Europe, import prospects in 2009 are mixed. Australia may need to step up its purchases, while those by the EU may reach a record 1.5 million tonnes. By contrast, the United States may cut its imports.
FAO's latest prospects point to a level of world paddy production in 2008 of 683 million tonnes (456 million tonnes, milled rice equivalent), 23 million tonne, or 3.5 per cent more than in 2007 and the fastest growth since 2005. The increase would be based on a 2.2 per cent rise of the area to 159 million hectares, a positive reaction to high prices and to government support. Favourable growing conditions also boosted average paddy yields by 1.3 per cent to 4.3 tonnes per hectare, despite soaring costs of fuel and fertilisers, and difficult access to quality seeds. Much of global production gain is expected to be concentrated in Asia but, with impressive increases foreseen in Africa, the region looks set to make an important contribution to world expansion in 2008.
FAO notes that the 2009 paddy season has already started in southern hemisphere countries. Although too early to draw a global production forecast, prospects are positive in Indonesia, but still uncertain in Madagascar and Mozambique where the cyclone season has already started.
Continued shortages of irrigation are again limiting plantings in Australia to well below normal. In South America, little growth is currently anticipated in Brazil while drought depressed planting in Uruguay. In Argentina, the area has increased but drought may affect yields.
Large supply availabilities in the traditional exporting countries are set to foster a small increase in global rice exports.
The expected lifting of export curbs in Egypt and India in May 2009 will also help boost trade. Among the various sources, China, India, Myanmar, Pakistan, Viet Nam and Egypt are forecast to increase their exports, more than offsetting lower expected deliveries by Brazil, Cambodia, Thailand and the United States, FAO observes.
It notes, one outcome of the 2008 global production surge is expected to be a strong rebuilding of world rice stocks carried over 2009, now forecast to reach 118 million tonnes, the highest since 2002 and 9 million tonnes more than in 2008.
Globally, reserves in 2009 will be sufficient to cover 25.8 per cent, or roughly three months, of planned utilisation in 2009, up from 24.4 per cent in 2008. The higher value of the stock-to-use ratio is indicative of an improved level of security, as far as rice is concerned, at the world level. The forecast points out that much of the stock build-up is expected to be concentrated in exporting countries, and especially in China and India, which hold the largest rice reserves, but also in Egypt, Pakistan, Thailand and Viet Nam. Traditional importing countries, such as Indonesia, Sri Lanka, Saudi Arabia and the United Arab Emirates, are also foreseen to increase the size of rice inventories.
Since reaching peak levels last May, world rice prices have steadily declined until December 2008, reflecting a retreat of importers and the harvesting of large 2008 main paddy crops since October.