Hanim Adnan The Star 15 Feb 11;
OF late, there is this massive pressure on Asian nations to stockpile rice as part of their national food security efforts.
With the weather pattern wreaking havoc on food crops leading to dwindling supplies and rising food inflation, there is looming fear the current price of rice may soon revisit the all-time record price in 2008, which at one time saw the grain price surging by 200%.
The global rice market has been on the rise again over the past few months after hitting a two-year low in early August 2010. The price of the Asian rice benchmark, Thai 100% grade-B white rice, has steadily risen by about 4.5% since Dec 29 to reach about US$558 per tonne.
Despite the assurance of ample rice supply by the world's largest rice producers Thailand and Vietnam, Indonesia and Bangladesh have become among the earliest Asian nations to extensively boost their rice imports for 2011.
Early this month, Indonesia had ordered its state procurement agency Bulog to secure imports to gradually boost its rice stockpiles to two million tonnes from the current 1.5 million tonnes. Indonesia surprised the market recently by purchasing 820,000 tonnes of rice from Thailand for prompt shipment.
Bangladesh has also said it was buying 200,000 tonnes of parboiled rice from Thailand in the first government-to-government deal for the grain.
Malaysia has also been steadily stockpiling rice. After the bitter experience of 2008, Bernas the local rice custodian has been procuring rice over the past two years via active buying both on the spot and forward contract for two to six months to build up stocks.
According to some quarters, more Asian nations would likely make similar move to boost their rice stockpile should drought-striken China, the world's largest rice consumer, start to procure more rice externally in the near term. China has been self-sufficient of the grain.
Interestingly, Vietnam, the second world largest rice producer, is also stockpiling its rice at about one million tonnes but Thailand intends to reduce its volume of it domestic stockpile to only 100,000 tonnes and export 900,000 tonnes from its stockpile.
Meanwhile, the Thai government is not overly worried about lowering its stockpile as new harvest will start soon. It is likely to export 10.73 million tonnes of the 2010-11 crop, up slightly from 10 million for 2009-10.
So what will be in store next as the scramble to stockpile rice hots up among Asian countries?
Given such a dire situation, it seems the proposal to create a permanent rice emergency reserve by the 10-member Asean together wth China, South Korea and Japan (Asean plus three) may likely be speeded up.
A meeting is slated in Jakarta later this year to discuss the supply and financing, and the mechanism to the countries should a hike in prices occur.
In addition, a blueprint will also be put up for the establishment of a 800,000-tonne strategic rice storage facility with pledges from Asean members, Japan, China and South Korea to protect the region's two billion people from an environmental disaster and a runaway inflation.
# Deputy news editor Hanim Adnan is all for the rice emergency reserve as it will certainly help secure price and food security as well as rice development in the region.
