Rice Up Bt3-5 A Kilo On Export Demand

[george]

Rice up bt3-5 a kilo on export demand

Mingkwan determined to benefit farmers

BANGKOK: -- Rice will cost consumers Bt3-Bt5 more a kilogram after the Commerce Ministry committed itself to boosting the local price to the export level for the benefit of farmers.

"We want to give more benefits to farmers while balancing the impact on consumers," said Deputy Prime Minister and Commerce Minister Mingkwan Sangsuwan yesterday. The ministry would also take into account rising fertiliser prices.

Apparently ignoring traders and exporters, all 4.25 million tonnes from the new harvest season will be exported. Some could be bagged for domestic sale, but the price would be equivalent to the export price, Mingkwan said.

Thais currently pay Bt18-Bt25 a kg. If the export price reaches US$1,000 (Nt31,469) a tonne as expected, the local price would start at around Bt25 a kg.

Mingkwan foresees continued hikes in rice prices, with the export price topping the $1,000 a tonne mark. To ensure farmers get the maximum benefit, the Export Promotion Department will work with them in distributing rice directly to overseas buyers.

To help consumers, the ministry will distribute 2.5 million tonnes of rice at last year's cost, when rice was Bt6,600-Bt7,200 a tonne. The rice will be packed in 5kg bags and sold through provincial commerce offices. This will account for 10 per cent of annual consumption, which is 9 million tonnes.

Mingkwan noted that exporters should not be troubled given that they are enjoying higher profits from their inventories.

Meanwhile, he insisted only 13,000 tonnes of stockpiled rice had been stolen, contrary to an earlier report of 200,000 tonnes.

Skyrocketing prices have sparked demand for rice from Thailand, the world's biggest supplier. During January 1 and March 21, exports reached 2.8 million tonnes, worth $1.22 billion. Compared to the same period last year, volume rose 71.69 per cent from 1.64 million tonnes while the dollar-denominated value was up 95.94 per cent from $623 million. In baht terms, the export value totalled Bt40 billion, or 84.36 per cent, up from Bt21.8 billion from the same period a year earlier.

Deputy Commerce Minister Wirun Techapaiboon attributed the sharp rise to the increase in average export prices to $433 a tonne, up from $380 million last year.

--TNA 2008-03-27

[Ricardo]

These higher prices are excellent news, for the growers at least, but how can the PPP-led coalition-government claim the credit for helping the poor farmers, without being blamed for the higher prices to the poor Thai consumers ? Perhaps it is the fault of those danged foreigners, being willing to pay higher prices, curse them ?

And how to generate widespread brown-envelopes, to the faithful, from the solution ?

A vexing issue indeed.

[zzdocxx]

Dunno if this is related or credible, but I just saw this article online, it is from the Christian Science Monitor.

http://www.csmonitor.com/2008/0327/p01s02-woap.html

Bangkok, Thailand - - Rice farmers here are staying awake in shifts at night to guard their fields from thieves. In Peru, shortages of wheat flour are prompting the military to make bread with potato flour, a native crop. In Egypt, Cameroon, and Burkina Faso food riots have broken out in the past week.

Around the world, governments and aid groups are grappling with the escalating cost of basic grains. In December, 37 countries faced a food crisis, reports the UN Food and Agricultural Organization (FAO), and 20 nations had imposed some form of food-price controls.

In Asia, where rice is on every plate, prices are shooting up almost daily. Premium Thai fragrant rice now costs $900 per ton, a nearly 30 percent rise from a month ago.

Exporters say the price could eclipse $1,000 per ton by June. Similarly, prices of white rice have climbed about 50 percent since January to $600 per ton and are projected to jump another 40 percent to $800 per ton in April.

The skyrocketing prices have prompted millers to default on rice supply contracts and bandits to steal rice as they aim to hoard the crop, and sell it later, as prices continue to rise.

“The farmers are afraid as their fields have been robbed in the nighttime,” says Sarayouth Phumithon, an official at the Thai government’s Bureau of Rice Strategy and Supply. “This is just the beginning. The problem will get worse if the price keeps increasing.”

The reported thefts in five rice-growing provinces in central Thailand are the first signs of criminal activity in this region stemming from the sharpest global spike in commodity prices since the oil crisis in the mid-1970s. Across the world, higher food prices are triggering thefts and violence – both by people who can’t afford to eat and those who want to make an easy buck.

Three men delivering food for the World Food Programme (WFP) in Sudan were reported killed Tuesday, the latest in a surge of attacks that have delayed the arrival of vital supplies to some 2 million people in the region.

So far this year, the UN agency says 56 trucks have been hijacked in Sudan; 36 trucks remain missing, and 24 drivers are unaccounted for. The WFP says that banditry has reduced by half the amount of food normally transported to the western region of Darfur at this time of year.

“All parties must recognize that the drivers of humanitarian vehicles and their cargo are serving a neutral purpose,” WFP Sudan representative Kenro Oshidari said in a statement.

Last year, the Food and Agriculture Organization’s food price index increased an unprecedented 40 percent from 2006, and this year it is projected to continue rising. Surging oil prices (in turn, boosting fertilizer and transport costs) combined with a drop in production due to droughts in Australia and the Ukraine have helped to drain global food stocks.

While rice production is rising, consumption is growing faster. The US Department of Agriculture forecast rice stocks to fall to their lowest level since the mid-1970s, and wheat stocks are projected to hit their lowest point since 1946, the year after World War II ended.

These factors, combined with a falling US dollar, steadily rising demand from developing countries, and biofuel policies that mop up excess cereal production, have all helped boost world prices.

The FAO expects food prices to stay high for the next three to five years, presenting a challenge for governments trying to keep domestic food prices low in order to keep poor citizens properly fed and avoid mass protests and social unrest.

Some countries like Vietnam, India, and Pakistan have banned grain exports. On Wednesday, Cambodia’s prime minister ordered a two-month ban on rice exports to neighboring Thailand and Vietnam “to guarantee food security.”

Meanwhile food importers Indonesia, Korea, and Mongolia have cut or reduced import tariffs. As Philippine farmers warned that the country was facing a serious rice shortage, the government signed a deal Wednesday to import 1.5 million metric tons (1.65 million US tons) of rice from Vietnam.

Analysts note that the current shortage isn’t hitting as many people as hard as past shortages. As incomes rise worldwide, food is a smaller portion of the family budget. “Governments have tried to protect domestic prices from fluctuations in international prices, and they have succeeded in the past,” says Sumiter Broca, a policy analyst at the FAO. “The key point is that the proportion of income spent on food is much lower than it used to be, so that provides a cushion. The situation is not as serious as it was in 1974.”

Citizens of Nepal and India now spend about 35 to 40 percent of income on food, down from about 70 to 80 percent in the early 1970s, Mr. Broca says. In developing countries, food costs eat up only about 7 percent of household incomes.

The FAO expects food prices to stabilize and eventually drop as farmers plant more grains. That’s already starting to happen with wheat and corn. But the next few years could be difficult.

On Monday, the WFP, a UN agency that distributes food aid to some 70 million poor people, made an “extraordinary emergency appeal” to donor countries for $500 million to prevent cutbacks in its global operations.

In the past two weeks, two rice suppliers in Cambodia defaulted on contracts with the WFP, claiming the new higher prices would offset any penalty for reneging on the contract.

“That’s extremely worrying, as it indicates the price of rice, just like the price of wheat, is now continuing to increase,” says Paul Risley, a WFP spokesman. “That makes it very difficult for us to find rice at an affordable price. The ability to end malnutrition is limited when food prices are so high.”

Countries with higher foreign exchange reserves and food stocks, including China, Japan, and India, can still afford the high food prices if necessary. But nations with low currency reserves like the Philippines, Pakistan, Bangladesh, and Nepal may need assistance from international financial institutions to afford food if prices continue to spike.

Although higher food prices mean trouble for consumers and governments, they do increase incomes for farmers – assuming their crops aren’t stolen. Still, farmers aren’t making as much money as a middleman with a good-sized warehouse.

Rice millers in Thailand are defaulting on contracts with exporters to capitalize on higher prices, and speculators are renting warehouses to store paddy. Rice in paddy form (in the husk) can be stored for about a year and a half before quality starts to deteriorate, and milled rice can be held for another six months.

“Nobody dares to sell now as we don’t know where the price is going,” says Chookiat Ophaswongse, president of Thailand’s Rice Exporters Association. Although Thailand, the world’s largest rice exporter, has shipped record amounts in January and February, traders have lost money on futures contracts as prices have jumped more quickly than anyone expected, he says.

In the Philippines, President Gloria Macapagal Arroyo has vowed to crack down on rice hoarders. The government has ordered police to stake out warehouses and follow trucks to see where the rice was going, she said.

Thailand may try to sell off 2.1 million tons of rice stocks to keep domestic prices low. But as long as prices stay high, Thai farmers will need to burn the midnight oil keeping watch over their fields.

“Most farmers must sell crops immediately as they don’t have a good warehouse that can withstand attacks from rats, birds, chickens – or human thieves,” says Mr. Sarayouth.

Associated Press reports were used in this story.

Edited March 27, 2008 by zzdocxx

[cclub75]

It's interesting to note the rethoric of the article... Like if this hike was a "choice" of the Minister to "help" the farmers.

It's total thai bullcrap, as usual.

The fact is : prices of rice on world markets have exploded. But the prices on the domestic market are "controled"...

They were before higher than those on world market (policy of subsidy to support the farmers)... but now the situation has totally reversed. And meanwhile the costs for producing rices have increased too.

Therefore : there is a risk of... shortage ! Farmers have no interest to sell their crop on domestic market, and loosing money, compare to export.

So the only solution : increase the prices on domestic market... to alleviate the pressure.

But then : you hit the entire population. Because of inflation.

So again : we shall repeat : it's not a "choice" or a "policy" from the government...

They have NO CHOICE.

And it will seriously backfire regarding inflation.

[Plus]

Yeah, well, Mingkwan is over his head with all this price control thing. It will backfire fast and hard when he's forced to abandon it in a couple of months, it will be an avalanche with sudden increases all across the board, from fuel to rice to cooking gas to shampoo.

[Martin]

"So the only solution : increase the prices on domestic market... to alleviate the pressure.

But then : you hit the entire population. Because of inflation."

I don't think that you do hit the entire population, 'cclub75'.

All the millions of us who eat rice that we have grown ourselves are 'insulated' against any rises of the price of rice in the shops, simply because we don't buy any in the shops.

Those of us who produce more rice than we need for home consumption, get more bahts when we take our surplus rice to sell to the buyer. That tends to 'insulate' us against the inflation in the things that we do have to buy at the talad.

I would agree that you hit the entire Greater Bangkok population---but they are just 10 million out of 65 million.

That 10 million is too high to sustain from here on in, but the labour shortage in the rural areas means that those who are hit to the extent that the downturn in the Greater Bangkok economy wipes out their jobs, but have 'get-up-and-go', can get up and go home to their villages.

When we get the annual flow from Greater Bangkok to the urban villages this Songkran, it will be interesting to see if they all flow back at the end of the holiday.

We might just see the first tiny reversal of the rural-to-urban drift of the past 40 years.

Prime Minister Field Marshal Sarit exaggerated when he said: "Thailand is Bangkok, and Bangkok is Thailand".

To be accurate, he should have said: "Temporarily, Bangkok is becoming a greater percentage of Thailand."

(As he whom we are not allowed to mention realised, and has been warning about ever since his 1974 speech to those university students.)

[cclub75]

"So the only solution : increase the prices on domestic market... to alleviate the pressure.

But then : you hit the entire population. Because of inflation."

I don't think that you do hit the entire population, 'cclub75'.

All the millions of us who eat rice that we have grown ourselves are 'insulated' against any rises of the price of rice in the shops, simply because we don't buy any in the shops.

Those of us who produce more rice than we need for home consumption, get more bahts when we take our surplus rice to sell to the buyer. That tends to 'insulate' us against the inflation in the things that we do have to buy at the talad.

You have a point.

But, we need to consider the whole picture... When prices are increasing on one set of product or services, it could have effect on others etc.

Plus the fact that we are linked to the oustide : we currently import inflation (oil and other commodities), because the BOT tries everything it can to curb the appreciation of the THB versus the USD (to boost the... exports)...

That's the main problem with inflation : it's difficult to contain it on a part of the economy. There is always a risk that it gets out of control, like a forest fire, with what the central banks call the "secondary effects"...

What will happen when people will start to ask for higher wages ? Increases of costs... and further increases of prices.

Furthermore, we need to add to this already uggly picture the fact that the government has only one policy : postpone as long as it can prices increases (for instance, public transports with bus fares, and I don't even speak about the new subsidy on diesel) etc.

By doing so, they increase the risk of a "tsunami" effect : when all producers of goods will increase simultaneously their prices, when the burden of costs will be too heavy.

Edited March 27, 2008 by cclub75

[soundman]

The fatal flaw in "increased selling price will benefit all farmers" is that most farmers will only see marginal benefits from this, especially considering record high fuel prices & prices of fertiliser nearly doubling in the past year along with land owners increasing rents substancially in accordance with perceived higher demand for land due in part to the rising price of rice, and land usage trending towards fuel crops such as tapioca and eucalypt.

On top of that, businessmen (not farmers) are grabbing as much land (buy or rent) as they can & outsourcing all aspects of the rice growing cycle reducing the farmers, who cannot afford the overheads, to cheap daily labor.

Soundman.

[zzdocxx]

http://www.ft.com/cms/s/0/d6f1cd74-fc29-11...?nclick_check=1

Jump in rice price fuels fears of unrest

By Javier Blas in London and Daniel Ten Kate in Bangkok

Published: March 27 2008 18:30 | Last updated: March 27 2008 18:30

Rice prices jumped 30 per cent to an all-time high on Thursday, raising fears of fresh outbreaks of social unrest across Asia where the grain is a staple food for more than 2.5bn people.

The increase came after Egypt, a leading exporter, imposed a formal ban on selling rice abroad to keep local prices down, and the Philippines announced plans for a major purchase of the grain in the international market to boost supplies. Global rice stocks are at their lowest since 1976.

While prices of wheat, corn and other agricultural commodities have surged since late 2006, the increase in rice prices only started in January.

The Egyptian export ban formalises a previously poorly enforced curb and follows similar restrictions imposed by Vietnam and India, the world’s second- and third-largest exporters. Cambodia, a small seller, also on Thursday announced an export ban.

These foreign sales restrictions have removed about a third of the rice traded in the international market.

“I have no idea how importing countries will get rice,” said Chookiat Ophaswongse, president of the Thai Rice Exporters Association. He forecast that prices would rise further.

The Philippines, the world’s largest buyer of the grain, said on Thursday it wanted to purchase 500,000 tonnes after it failed to buy a similar amount earlier this month. It is struggling to import 1.8m-2.1m tonnes to cover a production shortfall and on Thursday confirmed it would tap emergency stocks maintained by Vietnam and Thailand.

Rice is also a staple in Africa, particularly for small countries such as Cameroon, Burkina Faso and Senegal that have already suffered social unrest because of high food prices.

Thai rice, a global benchmark, was quoted on Thursday at $760 a tonne, up about 30 per cent from the previous daily quote of about $580 a tonne, according to Reuters data. Some traders, however, said the daily jump was not as steep, adding that Thai rice had already traded at about $700 a tonne this week.

Rice prices have doubled since January, when the grain traded at about $380 a tonne, boosted by strong Asian, Middle Eastern and African demand.

Additional reporting by Roel Landingin in Manila

Edited March 28, 2008 by zzdocxx

[LaoPo]

Rice Jumps to Record, Corn Near High as Demand Outpaces Supply

April 3 (Bloomberg) -- Rice climbed to a record and corn traded near its highest ever on speculation a 3 percent annual increase in global demand for cereals will outstrip supply as governments curb exports to prevent protests.

Rice, the staple food for about 3 billion people, rose 2.4 percent in Chicago trading today after doubling in the past year. Soybeans advanced for the third day and wheat gained as investors bought agricultural commodities on concern dry weather in the Great Plains and heavy rain in the eastern Midwest may curtail U.S. production and push down global inventories.

The World Bank estimates ``that 33 countries around the world face potential social unrest because of the acute hike in food and energy prices,'' Robert Zoellick, the bank's president, said on the organization's Web site. For these countries ``there is no margin for survival,'' he said.

China, India and Vietnam have cut rice exports, and Indonesia has reduced import tariffs to protect food supplies and cool inflation. Rice in Chicago climbed 42 percent in the first quarter, the biggest such increase in at least 14 years. Record grain prices contributed to strikes in Argentina, riots in Ivory Coast and a crackdown on illicit exports in Pakistan.

Rough rice for May delivery advanced to $20.26 per 100 pounds on the Chicago Board of Trade today as the United Nations' Food and Agriculture Organization said global exports will drop 3.5 percent this year as nations curb sales.

``The international rice market is currently facing a particularly difficult situation with demand outstripping supply and substantial price increases,'' said Concepcion Calpe, a senior economist at the Rome-based FAO, an agency that seeks to achieve global food security.

Commodity Gains

Commodity prices are posting their seventh year of gains. The UBS Bloomberg Constant Maturity Commodity Index of 26 raw materials more than tripled in the past six years as global demand led by China outpaced supplies of metals and crops. The Standard & Poor's 500 Index of stocks gained about 20 percent.

``As financial markets have tumbled, food prices have soared,'' Zoellick said in a speech dated yesterday. Since 2005 ``the prices of staples have jumped 80 percent,'' he said.

Corn for May delivery gained as much as 0.5 percent to $5.9875 a bushel. The commodity rose to a record $5.9925 a bushel yesterday on concern that rains in the U.S., the world's largest producer and exporter of the crop, will delay planting.

``We're looking at very strong fundamentals for corn,'' Kazuhiko Saito, a strategist at Interes Capital Management, said in a telephone interview from Tokyo today. ``The possibility of delayed planting in the U.S. is adding to the bullishness.''

Food Shortages

Indonesia, the world's third-largest rice producer, may join China, India, Vietnam and Egypt in curbing exports to secure domestic supplies, Agriculture Minister Anton Apriyantono said yesterday in a text message to Bloomberg News.

The world's poor ``are living very close to the edge as it is,'' said Robert Zeigler, director-general of the International Rice Research Institute in the Philippines. ``If they are pushed further, they are typically the first who will spark unrest.''

Consumer prices in China rose 8.7 percent in February, an 11-year high, and reached a 13-month peak in India. Chinese food prices, based on a government index, jumped 28 percent in February, the most since July.

The United Nations warned in February that 36 countries, including China, face food emergencies this year, as stockpiles of grains such as rice drop to a 26-year low.

Vietnam Curbs

The Vietnam Food Association has asked its members to stop signing new rice-export contracts between April and June, following Prime Minister Nguyen Tan Dung's directive to cut delivery of the grain overseas.

Vietnam, one of the world's three biggest rice exporters, will reduce shipments this year to 4 million tons to ensure supplies domestically and curb inflation that's at its highest in more than a decade. The government also said it's considering a tax for rice exports.

Malaysia plans to step up efforts to import rice from other Southeast Asian nations to build reserves. The Philippines is buying the grain from an emergency regional stockpile and taking additional supplies from the U.S.

http://www.bloomberg.com/apps/news?pid=206...&refer=news

LaoPo

[Johpa]

These higher prices are excellent news, for the growers at least, but how can the PPP-led coalition-government claim the credit for helping the poor farmers, without being blamed for the higher prices to the poor Thai consumers ? Perhaps it is the fault of those danged foreigners, being willing to pay higher prices, curse them ?

And how to generate widespread brown-envelopes, to the faithful, from the solution ?

A vexing issue indeed.

I find it hard to believe that the growers will reap the benefits. The growers do not sell directly to the international market but sell to local mill owners who then sell forward to the few families who control the export of rice. It is those families for whom the news is indeed most excellent. That is not to say that the growers will not reap some modest benefits, but most of the increased profits will go to the few. And those few will decide how much rice will cost domestically and will try to max out their profits without crossing the line where the populace begins protesting that core rallying point that began the French Revolution that there was no bread. Shall the Thais be told also to eat cake?

As an earlier poster noted, in the rural areas people tend to only sell their rice surplus. Those who have no land, and there are many, either rent land or exchange labor during planting and harvest in exchange for rice. Those who rent padi land usually must give 50% of the crop to the landlord, so clearly the landlord will benefit. Alas for the poor who exchange labor for rice, they do not obtain a years worth so they will have to pay market prices for some of their year's rice. It is the urban poor who will be hardest hit by increased rice prices and will lead the way against the government if the families who control the rice market get too greedy for their own good. It will be up to the few families in control of the rice exports, with some modest pressure from the government, to keep rice affordable to the laborers in the Bangkok region. Otherwise, one can see the perfect storm brewing for trouble in LOS.

[LaoPo]

Asian states feel rice pinch

This article is an interesting but also frightening read !

http://news.bbc.co.uk/2/hi/south_asia/7324596.stm#graph

About the situation in THAILAND:

Thailand has long been the world's largest exporter of rice, well ahead of Vietnam and the US.

It has not yet placed any restrictions on exports, and has denied reports that it is considering taking this step.

However, some rice millers and traders who deal on forward contracts have been suffering, after being caught out by price fluctuations.

Exporters have even complained that they would prefer to have stable prices than high prices.

Some millers have hoarded rice in an attempt to earn higher profits later on, pushing prices higher still as they restrict supply.

The government has released some of its 2.1 million tonnes of stockpiled rice in an attempt to contain inflation.

Rice prices increased by more than 50% last year and have continued to rise.

While in some countries rice consumption has risen with prosperity, Thais have been eating a greater variety of foods and less rice as they have become wealthier.

Other countries in the link.

LaoPo

[Johpa]

This article is an interesting but also frightening read !

http://news.bbc.co.uk/2/hi/south_asia/7324596.stm#graph

Thanks for the link to the BBC article. Note that the top ten countries that import rice are not your UN models of stability, with over half of them being neighbors of Thailand.

[LaoPo]

This article is an interesting but also frightening read !

http://news.bbc.co.uk/2/hi/south_asia/7324596.stm#graph

Thanks for the link to the BBC article. Note that the top ten countries that import rice are not your UN models of stability, with over half of them being neighbors of Thailand.

I think you mean the Top 10 countries receiving Rice Aid ?

LaoPo

[LaoPo]

"Thailand is the world's biggest rice exporter.

The Thai Rice Exporters Association said exporters fulfilled orders for 2,000 tonnes of rice on Thursday, while 10,000 tonnes were ordered."

http://news.bbc.co.uk/2/hi/business/7328087.stm

LaoPo

[Bagwan]

A month ago when visiting family in Lomsak we took 50kg sack of Hom Mali rice for their consumption. Cost was 800THB. This week, planning a further visit (to get away from the Songkran madness in Pattaya) we bought 2x50kg of the same rice, cost 2200THB. Luckily I paid when ordering, for the following day when the khao was delivered, I was told that the price had risen to 2400THB. 50% increase in about 4 weeks.

[LaoPo]

Thailand Rules Out Selling Rice From State Stockpile

By Anuchit Nguyen

April 6 (Bloomberg) -- Thailand, the world's biggest rice exporter, ruled out selling some of the 2 million metric tons of the grain it has stockpiled as global prices rise to records.

Supplies will increase in the coming months as about 6 million tons of milled rice enters the market from the nation's April-June harvest, said Commerce Minister Mingkwan Sangsuwan.

``There is enough rice supply for domestic consumption'', Mingkwan told reporters late yesterday in Nonthaburi province, near Bangkok. ``The current shortage has been caused by some hoarding and panic buying on concern the price will rise further.'' There is no need to reduce exports, he said.

Rice, the staple food for about 3 billion people, has nearly doubled in the past year on increased imports by the Philippines, the biggest buyer, and as China, India and Vietnam cut exports. Record food and fuel prices have stoked inflation, contributing to strikes in Argentina, riots in Ivory Coast and a crackdown on illicit exports in Pakistan.

``With its decision to maintain the rice stockpile, the Thai government wants farmers to fully benefit from the high prices as a new harvest comes to the market,'' Sumeth Laomoraphorn, president of C.P. Intertrade Ltd., Thailand's sixth-largest rice exporter, said by telephone today.

Mingkwan, who yesterday met with traders and government officials, had earlier proposed selling 200,000 tons of stockpiled milled rice to increase local supplies.

Stricter Inspections

The ministry has added to the number of officials who inspect rice millers, warehouses and retailers to prevent hoarding of the commodity, said Mingkwan. The government has no plans to reduce rice exports because supplies are adequate to cover overseas orders, he said.

The retail price of average-grade rice, the country's most consumed grain, rose to a record 26 baht (82 cents) a kilogram, an 11 percent increase from a week earlier, according to the commerce ministry's Web site. That prompted some industry figures to disagree with the government's decision not to provide more of the grain.

``The release of state stockpiles should be made urgently to ease rice shortages in the domestic market,'' Pramote Vanichanont, Honorary President of the Thai Rice Mills Association, a trade group of rice millers, said after the meeting with Mingkwan. ``Most Thais, especially the poor, are suffering from the surge in prices of rice, which is their basic necessity.''

Export Caps

The government should cap rice exports at 900,000 tons a month to prevent potential domestic shortages, Chookiat Ophaswongse, president of Thailand's Rice Exporters Association, said after the meeting.

The Southeast Asian nation may be able to deliver as much as 1.2 million tons of rice a month, Prasert Gosalvitra, head of the rice division of the farm ministry, said in an April 4 interview. Thailand has shipped about 1 million tons a month this year, according to traders.

The country's rice shipments may drop in the next few months because exporters are reluctant to take large advance orders on concern they could miss out on further gains in prices, Intertrade's Laomoraphorn said.

``They are taking orders for only the quantity of rice they can buy into their warehouses,'' he said. ``So, global supplies of rice will continue to be tight in the next few months.''

The World Bank estimates 33 countries face potential social unrest because of increasing food and energy prices, Robert Zoellick, the bank's president, said in a speech posted on its Web site April 2.

http://www.bloomberg.com/apps/news?pid=206...&refer=news

LaoPo

[Bagwan]

Thailand Rules Out Selling Rice From State Stockpile

By Anuchit Nguyen

April 6 (Bloomberg) -- Thailand, the world's biggest rice exporter, ruled out selling some of the 2 million metric tons of the grain it has stockpiled as global prices rise to records.

I wonder how much of the 2 million metric tons actually exists. Remember the longan scandal? Another honest mistake in the offing?

[Johpa]

``With its decision to maintain the rice stockpile, the Thai government wants farmers to fully benefit from the high prices as a new harvest comes to the market,'' Sumeth Laomoraphorn, president of C.P. Intertrade Ltd., Thailand's sixth-largest rice exporter, said by telephone today.

C.P. Intertrade Ltd, which I suspect is a subsidiary of the CP Group, is only concerned about themselves not missing out on the current high prices on the global market. They care not a whit about the farmers, but they certainly do not want smaller mill owners to be hoarding away what they perceive as their potential profits. If there is going to be any hoarding it will be done by the major exporters.

As others have noted, we have no way of knowing the accuracy of the quoted rice stockpiles in the Kingdom. The rapid increase in rice prices could easily serve as the catalyst to the perfect storm that is slowly brewing around Thailand, elements which include political instability, lack of political leadership, global economic uncertainty, and of course the other inevitability destined to fracture social cohesion.

And thanks to Lao Po for pointing out my error in reading the chart in the BBC article. Thailand still remains in the awkward position of being surrounded by countries who do not produce sufficient rice for internal consumption.

[LaoPo]

Rice Jumps to Record on Philippine Imports, Curbs on Exports

By Glenys Sim and Danielle Rossingh

April 8 (Bloomberg) -- Rice climbed to a record for a fourth day as the Philippines, the biggest importer, announced plans to buy 1 million tons and some of the world's largest exporters cut sales to ensure they can feed their own people.

Rice, the staple food for half the world, rose as much as 2.9 percent to $21.60 per 100 pounds in Chicago, double the price a year ago. Philippine President Gloria Arroyo announced two rice tenders today and pledged to crack down on hoarding. Anyone found guilty of ``stealing rice from the people'' will be jailed, she said.

``We're in for a tough time,'' Roland Jansen, chief executive officer of Pfaffikon, Switzerland-based Mother Earth Investments AG, said in an interview with Bloomberg Television from Zurich today. Unless prices decline, ``you will have huge problems of daily nutrition for half the planet.'' Mother Earth holds about 4 percent of its $100 million funds in the grain.

China, Egypt, Vietnam and India, accounting for more than a third of global rice exports, curbed sales this year to protect domestic stockpiles. The World Bank in Washington says 33 nations from Mexico to Yemen may face ``social unrest'' after food and energy costs increased for six consecutive years.

Continues here:

http://www.bloomberg.com/apps/news?pid=206...&refer=asia

LaoPo