THAILAND: Fear of shortages as rice prices keep rising
10 Apr 2008 11:09:29 GMT
Source: IRIN
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BANGKOK, 10 April 2008 (IRIN) - As food prices continue to skyrocket
throughout Asia, many governments are intervening to try to stabilise
their domestic rice prices for fear of acute shortages and possible
food riots. World stocks of rice have fallen to their lowest since the
early 1970s, and many agencies, including the UN World Food Programme
(WFP), are increasingly worried that food shortages and price rises
will mean cutting back on food assistance.
The top quality Thai hom mali rice now costs US$1,000 a tonne - up
more than three-fold from the start of the year. A more inferior
quality of 25 percent cracked rice, which the WFP buys for its
programme, is now just less than US$800 - nearly three times more than
four months ago. Many traditional ex****ting nations, including
Cambodia, Egypt, India and Pakistan, have banned ex****ts of rice,
while China and Vietnam have cut back dramatically.
"Malnutrition is almost certainly going to rise significantly in many
of the poorest parts of Asia," Action Aid's international director,
John Samuel, told IRIN.
The poorest Asian families will suffer most as they spend more than 70
percent of their income on food, according to WFP. Unable to afford
high-priced rice, they must rely on government-subsidised rice or
international food aid. But these sources are increasingly in jeopardy
because of price rises and shortages.
"In Nepal alone, the number of vulnerable people has jumped from four
to eight million in the last six months as a result of the market
price increases and related factors," said Tony Banbury, the regional
head of WFP. "That's 30 percent of the population in acute need of
assistance."
Curtailed feeding programmes
"Our school-feeding programmes in Cambodia have been effectively
suspended," Thomas Keusters, the head of WFP operations in Cambodia,
told IRIN. "Effectively there will be no school-feeding programme for
the rest of the academic year, affecting 450,000 children in grades
one to six."
Some supplies of rice bought by WFP in the local market have not been
delivered. Five suppliers have defaulted and WFP is short of 13,000
metric tonnes needed over the next six months.
In Bangladesh and Pakistan, people wait for hours to buy subsidised
rice in 5kg packs. In Thailand, the major supermarkets ration sales to
three 5kg bags per person to prevent panic buying.
Harvest hopes
Thailand's Commerce Minister, Mingkuan Sangsuwan, has announced a
government-sponsored cut of about 10 percent in all retail rice prices
from 14 April. The discount will end in two months when the new rice
crop, which is expected to be good, is harvested. Sufficient rice
stocks should then be available to meet Thai market needs, according
to the Thai Rice Millers' Association.
But elsewhere in Asia, governments are less sanguine. For example, the
Philippines secured only half its bid of 500,000 tonnes from Vietnam
two months ago and is expected to tender Hanoi for another 1 million
tonnes, Vichai Sriprasert, one of Thailand's leading rice ex****ters,
told IRIN. But they are unlikely to get more than half of that, he
added.
Bangladesh has managed to secure 400,000 tonnes of rice from India -
which has allowed limited ex****ts on humanitarian grounds. Bangladesh
also has a pledge from Burma to supply up to 500,000 tonnes.
Burma has also agreed to supply Sri Lanka with 50,000 tonnes of rice
at $400 a tonne, according to Anusa Palipta of the Sri Lankan
government. Sri Lanka is also getting 32,000 tonnes of rice from India
and Pakistan.
Fear of unrest
'The massive food riots in the Haitian capital this week are a wake-up
call for all Asian governments," said Action Aid's John Samuel. "If
immediate measures are not taken, like protective price and effective
distribution mechanisms, there will be food protests here too. There
is an agrarian crisis looming, which will become a major political
problem, especially for Asia's democracies."
Already in Bangladesh, Indonesia and the Philippines, each of which
has elections in the coming year, anger is growing. "Soaring food
prices have become a serious threat to the survival of the present
[caretaker] government," said Banglade**** economist and political
scientist, Atiur Rahman. "Food price hikes are likely to cause hortals
[strikes], food riots and violence on the streets."
"This is a crisis that has been brewing for years," said Samuel.
"Although there has been substantial economic growth right across the
region, this has been in the industrial and service sectors;
investment in agriculture has stagnated or even declined in real
terms. Unless there is concerted investment in agriculture in Asian
countries, food price hikes will become a perennial problem."
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