Asian Rice Shortage

Asian countries have been struggling to cope as the cost of rice has reached record levels.

The wholesale price of rice, a staple product for more than 2.5 billion people across Asia, has more than doubled in the past three months, while global supplies have fallen to a thirty-year low. Rice prices have risen by as much as 70% during the last year, according to the UN Food and Agriculture Organisation (FAO).

Shortages have begun to hit some importing countries.

Factors contributing to the price rise include:

* Poor harvests resulting from extreme weather

* A rise in demand in some rice-importing countries, where populations and incomes are growing

* The expectation of further price increases - resulting in hoarding

* Low stockpiles and a long term lack of agricultural investment

The spike is also part of a general surge in food costs worldwide, so the option of switching to cheaper foods is often not available.

Producers including India, China and Vietnam have restricted exports as they try to protect their stocks and limit inflation.

Importers such as Bangladesh, the Philippines, and Afghanistan have been hit hard.

Chinese prime minister Wen Jiabao said food inflation was the country's most "prominent" economic problem and urged efforts to boost grain output. Food prices in China have risen more than 20% so far this year.

The Philippines, meanwhile, has banned all future conversion of farmland for uses other than agricultural production. Agriculture Secretary Nasser Pangandaman said the move would stop the "unabated" transformation of farmland into residential property developments.

The Philippines is struggling to grow enough rice to provide for its 90 million strong population and is heavily reliant on exports from Thailand and Vietnam.

And what is Malaysia doing about this rice shortage? Nothing much, as Prime Minister Abdullah Ahmad Badawi still has his thumb stuck firmly up his arse. See below, that idiot takes three weeks of get his thumb out of his arse.

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PM: Announcement On Rice Issue On Monday

KUALA LUMPUR, May 9 (Bernama) -- The government will announce on Monday the measures it will be taking to counter the rice supply issue, Prime Minister Datuk Seri Abdullah Ahmad Badawi said Friday.

He said the Cabinet Committee to Counter Inflation will fine tune the proposal on the actions to be taken before the decision is made by the Cabinet.

"I have explained the suggested actions to be taken and on Monday when the committee meets, the measures will be endorsed by the Cabinet," he told reporters after attending a special meeting of the UMNO Supreme Council here Friday.

Abdullah said the issue of padi and rice was closely related to the present food shortage crisis said to have hit the world.

"Therefore we want to make sure we are not short of food supplies. Rice is very important to our country," he said.

Abdullah said the Minister of Agriculture and Agro Based Industry, Datuk Mustapa Mohamed, had also informed the council of his visit to Thailand with regards to the proposal for Malaysia to buy rice. -- BERNAMA

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When asked if the Domestic Trade and Consumer Affairs Ministry had put forward any suggestion on the matter, Minister Datuk Shahrir Samad said it had not but instead his ministry was only monitoring rice prices.

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Thailand Agrees To Sell 500,000 Tonnes Of Rice To Malaysia
By D. Arul Rajoo

BANGKOK, May 8 (Bernama) -- Thailand has agreed to meet Malaysia's request to purchase 500,000 tonnes of rice from the kingdom, with an immediate supply of between 100,000 and 250,000 tonnes, Thai Government spokesman Police Lt Gen Wicheenchot Sukchotratd said Thursday.

He said this decision was conveyed by Thai Prime Minister Samak Sundaravej to Malaysian Agriculture and Agro-based Industry Minister Datuk Mustapa Mohamed at their meeting here today.

Wicheenchot said Malaysia wanted the rice to beef up its stocks as it was concerned over its stockpile of rice which was enough for only 15 days.

"They are now concerned with the stocks and want to make sure there is enough (rice) in case of any crisis or food shortage," he told reporters after the meeting between Samak and Mustapa.

Mustapa, when approached after a meeting with representatives of the Thai Rice Exporters Association, declined to elaborate on his meeting with Samak or confirm whether Malaysia had made a request to purchase rice from Thailand.

He said he would brief the cabinet tomorrow on the outcome of his visit, adding that it was a follow-up to Samak's visit to Malaysia last month where the Thai prime minister had given the assurance that the world's largest rice exporter Thailand would continue to supply rice to its close neighbour despite the surge in prices.

"I will brief the prime minister and cabinet. Once the cabinet gives its guidelines, we will work from there. But there is no need to panic as we have ample supply of rice," he said.

Asked if the stockpile would only last for 15 days, Mustapa said it was not accurate as there was enough combination of rice and padi in the national stockpile for the next three months.

Mustapa said Samak had given the assurance that the Thai Government would help Malaysia to meet its rice requirement, adding that the price tag was not discussed at the meeting.

Thai Commerce Minister Mingkwan Saengsuwan and Malaysian Ambassador to Thailand Datuk Shaarani Ibrahim were also present at the 30-minute meeting.

Mustapa was also accompanied by Padiberas Nasional Berhad (Bernas) Managing Director Bakri Hamzah as well as representatives from the Ministry of Plantation Industries and Commodities and Malaysian Palm Oil Board (MPOB).

He said a team of officials from the ministry and Bernas would meet the Thai Rice Exporters Association on Monday to discuss details of the purchase.

The price of Thai white rice five per cent (five per cent broken grains)rose to an unprecedented US$1,000 (RM3,180) a tonne last month, from just US$360 (RM1,145) in October 2007 after Vietnam and India stopped their exports due to shortage of production.

According to reports, Bernas, which is Malaysia's sole rice importer, bought 831,000 tonnes from overseas suppliers in 2006, more than half of it from Thailand.

Thailand's average annual production of padi is about 32 million tonnes, or about 18 million to 20 million tonnes of white rice. -- BERNAMA

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Issue Of Price Increases Should Be Tackled Fast, Says ISIS Chairman

PENANG, May 8 (Bernama) -- The issue of the increase in prices of goods should be tackled wisely and measures taken fast to avoid the situation from burdening low income earners further, said Institute of Strategic and International Studies (ISIS) chairman Datuk Seri Mohamed Jawhar Hassan.

He said alternative measures should also be considered as preparation for any eventualities.

"Many projects under the Ninth Malaysia Plan have been shelved so that financial resources can be channelled to address the problem.

"As such, other alternatives have also to be looked into so that future generations are not saddled by poverty," he said when opening a public forum on entitled "Price Increases and People's Welfare: Current and Future Measures" at Universiti Sains Malaysia (USM) here Thursday.

Mohamed Jawhar, who also chaired the forum, said resolutions from the forum would be studied with the view of adopting them to curb the price increases.

"This discussion will not be of any use if the resolutions are not forwarded to the responsible agencies," he added.

He said although this was a global issue, Malaysia, despite having trade relations with many countries, also felt the impact.

"The impact is however not as serious as felt in other countries, to an extent that the situation led to protests and created social problems," he said.

He said today's forum was the second to be held after the one in Kuala Lumpur, which was held on April 25.

ISIS also plans to hold similar forums in Terengganu, Johor Baharu, Sabah and Sarawak.

The forum involved the participation of eight panel members from various government agencies, including the Domestic Trade and Consumer Affairs Ministry and the Malaysian Institute of Economic Research (MIER).-- BERNAMA

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Bernas Blames Private Millers For Rice Shortage

KUALA LUMPUR, May 8 (Bernama) -- Padiberas Nasional Berhad (Bernas) has blamed private commercial millers for the recent rice shortage in the local market.

Bernas managing director Bakry Hamzah said private millers who control 55 percent of the local rice market had significantly reduced their production in expectation that price would rise exponentially.

"This move has put pressure on Bernas to meet nearly 100 percent of the country's needs following the artificial shortage," he said in a statement Thursday.

Bernas which all this while commanded the balance 45 percent of the market, was not the cause of the shortage but had to strive to enhance production by importing more in the past four months to meet people's need, he said.

"Bernas would like to stress that despite the sharp increase in the price of rice in the global market, the company has not raised the price of imported rice to the wholesalers since April 2007," he said.

On Monday, a national newspaper reported that Bernas had cut imports by nearly 40 percent in the past four months due to price increase in the international market.

The report which quoted industry sources said Bernas had imported about 300,000 tonnes of rice since January while the ideal level was at least 500,000 tonnes to meet consumers' present demand.

Bakry said that while the price of rice in the world market had increased three-folds and saw neighbouring countries facing a supply shortage crisis, Bernas was still able to secure enough imports.

"This can be done by implementing long term purchase strategies and having very good harmonious relations with several major rice producing countries like Vietnam and Thailand," he said.

He said that in the past four months, Bernas had enhanced imports by 16.6 percent compared to the same period last year. The amount imported between January and April was 300,325 metric tonnes, he said.

Bakry said that despite the pressure on the price and supply of rice due to various factors in the global market, Bernas was confident it would be able to ensure the supply of rice in the country remain unaffected especially with the government's latest commitment pertaining to the issue.

Bernas would also ensure that the monthly production of 15 percent broken Super Tempatan rice would increase from 11,000 metric tonnes to 20,000 metric tonnes as instructed by the government.

He said the government also had to ensure private millers raise their production of this rice grade which is the only locally produced rice categorised as a controlled item.

Other rice grades are sold according to the prevailing market conditions.-- BERNAMA

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