Wheat turmoil to make rice prices volatile, warns IRRI
Thursday, 28 October 2010
MANILA, Oct 27 (AFP): Major crop losses in key wheat-growing regions around the world are likely to lead to more volatile prices of rice over the coming months, International Rice Research Institute experts warned Wednesday.
The problem is compounded by flood damage in Pakistan's rice-growing areas and drought and floods in China, with the latter potentially causing a 5-10 percent output drop this year, they said.
"Overall, the global rice supply is tightening but it is not as bad as what is happening in the major wheat-growing regions in the world," the Philippine-based IRRI said in its quarterly magazine "Rice Today".
"Given these supply uncertainties, (rice) prices are likely to be more volatile in the coming months, but nothing points to a repeat of the 2008 price crisis," when rice prices rocketed to 30-year highs.
The price of wheat spiked to two-year highs in August when Russia imposed a temporary ban on 2010 wheat exports following drought and wildfires that are forecast to cut its annual output by more than 30 percent.
Neighbours and fellow exporters Kazakhstan and Ukraine were also hard-hit, while heavy rain has wrought havoc in major Canadian wheat-growing regions.
The US agriculture department expects global wheat production in the 2010-2011 cropping season to fall 5.44 percent from a year earlier to 643 million tonnes, IRRI said.
Meanwhile, global rice production for the same period is likely to rise 3.26 percent to 455 million tonnes, it quoted the US agency as saying.
The institute said higher rice stockpiles compared to 2008 may not be much benefit because many are sitting in India and China, which it said are unlikely to release the stocks in the international market during any crisis.
Trade-related and other restrictions imposed by rice-growing countries since 2008 to promote food self-sufficiency are likely to lead to an even smaller global rice market in the future, it warned.
The problem is compounded by flood damage in Pakistan's rice-growing areas and drought and floods in China, with the latter potentially causing a 5-10 percent output drop this year, they said.
"Overall, the global rice supply is tightening but it is not as bad as what is happening in the major wheat-growing regions in the world," the Philippine-based IRRI said in its quarterly magazine "Rice Today".
"Given these supply uncertainties, (rice) prices are likely to be more volatile in the coming months, but nothing points to a repeat of the 2008 price crisis," when rice prices rocketed to 30-year highs.
The price of wheat spiked to two-year highs in August when Russia imposed a temporary ban on 2010 wheat exports following drought and wildfires that are forecast to cut its annual output by more than 30 percent.
Neighbours and fellow exporters Kazakhstan and Ukraine were also hard-hit, while heavy rain has wrought havoc in major Canadian wheat-growing regions.
The US agriculture department expects global wheat production in the 2010-2011 cropping season to fall 5.44 percent from a year earlier to 643 million tonnes, IRRI said.
Meanwhile, global rice production for the same period is likely to rise 3.26 percent to 455 million tonnes, it quoted the US agency as saying.
The institute said higher rice stockpiles compared to 2008 may not be much benefit because many are sitting in India and China, which it said are unlikely to release the stocks in the international market during any crisis.
Trade-related and other restrictions imposed by rice-growing countries since 2008 to promote food self-sufficiency are likely to lead to an even smaller global rice market in the future, it warned.