Global rice traders pray for good monsoon

NEW DELHI, April 12 (Economic Times): Rice importers across the globe are keenly watching the monsoon forecast for India as poor rains in the world's second-largest producer could spike prices of the commodity in the international markets. Rice prices have remained relatively stable since June last year rising only 17 per cent, against a 50-150 per cent hike seen in prices of other field crops over the period, according to the Manila-based International Rice Research Institute (IRRI). "Several emerging issues could shake this delicately-balanced rice market within a short time," said Samarendu Mohanty in Rice Today, a magazine published by IRRI. "More importantly, panic among rice growing countries could easily rattle this market." "The disruption of the monsoon, similar to the one witnessed on the Indian subcontinent in 2009, can also tip this delicately-balanced rice market," added Mohanty, who heads IRRI's social sciences division. Latest estimates of the US department of agriculture are already pointing towards a 20-per cent decline in the area under rice in US this year to 1.15 million hectares. India's rice stock position, however, has provided comfort to the international market so far. Rains in northern China and a timely Asian and Indian monsoon will decide whether the world will witness another stable year for rice or not. The ongoing drought in northern China, for instance, could fuel another round of price escalation in grain. Planting will be affected if the drought persists for some more months, which in turn will push up the prices. The India Meteorological Department has forecast a normal monsoon for the country this year. The third advanced crop production estimates for 2010-11, released by the government last week, have indicated the highest foodgrain production in the country since Independence.