Rice Climbs To Record As World Bank Warns Of Thai Export Risk

[jerrylee]

The issue is not with the cost of the rice per se, but rather the cost of getting that product to the desired market. Like getting a rocket to low earth orbit, where the weight of the fuel is the biggest obstacle to overcome, getting rice to Japan, the transport costs may be more than the cost of the actual rice itself.

Uhh, no. Japan places restrictions and immense duties on rice imports.

Yes, I'm well aware of this fact, and have stated so in many earlier posts before this thread. It is a classic example of government intervention in the free market causing the bulk of population to pay more than they should have to. It is well known that Japanese rice prices are some of the highest in the world for no other reason that this protectionist subsidy.

My point in the other post was that transport costs can be very high relative to the cost of the actual product. Just as with the US importing oil from the middle east, the transportation costs are enormous compared to what they could be with local production.

Globalization or Localization? What about a Rice Bowl Pact ?

[LaoPo]

Rice Declines as Seeding Accelerates in the U.S., Exports Slow

By Jae Hur and Tony C. Dreibus

April 29 (Bloomberg) -- Rice fell to the lowest in almost two weeks after a government report showed U.S. planting accelerated last week and grain sales slowed, easing concern of a global food crisis.

Farmers in the U.S., the world's third-largest exporter, planted 44 percent of their rice crop as of April 27, up from 26 percent a week earlier, the government said yesterday. The pace is behind the five-year average of 58 percent for that date. U.S. rice exporters reported sales of 25,800 metric tons in the week ended April 17, down 85 percent from a week earlier.

The price has dropped 8.5 percent since reaching a record April 24 in Chicago. Rice, a food staple for half the world, has doubled in the past year as China, Vietnam and India curbed exports. High costs stoked social tension in Asia and Africa and prompted Wal-Mart Stores Inc.'s Sam's Club to limit purchases of jasmine, basmati and long-grain white rice in U.S. stores.

``Planting progress last night was higher than people were generally expecting,'' said Jack Scoville, vice president of Price Futures Group in Chicago. ``Export sales were rather poor.''

Rice for July delivery fell 75 cents, or 3.2 percent, to $22.93 per hundred pounds on the Chicago Board of Trade, the lowest for a most-active contract since April 16.

The cereal has fallen from a record $25.07 after Thailand and Brazil said they won't curb exports and Pakistan announced plans to sell 2.5 million tons of the grain, easing concern that global supplies were short.

U.S. Crop, Shipments

In the U.S., about 20 percent the rice crop had sprouted as of April 27, compared with 30 percent a year earlier, the U.S. Department of Agriculture said in its report yesterday.

Along with slowing sales of rice overseas, shipments of the grain from the U.S. declined 27 percent from the prior week to 68,400 tons, with 24,100 tons sent to Panama, the USDA said on April 24.

``If we're the cheapest in the world, we need to be selling at a faster rate than we have been,'' Scoville said. ``If we're trying to make a demand case that we should be selling a lot of rice because prices in Asia are $1,000 a ton, then only one good week of sales hurts your case.''

Vietnam Supplies

Vietnam, the world's second-biggest supplier after Thailand, said April 27 it will produce enough to meet demand from exporters and local consumers, and banned speculators from the domestic market to help stem price increases.

``Our rice output this year will be sufficient for consumption and export,'' Prime Minister Nguyen Tan Dung said in a statement posted on the government's Web site. Brokers and anyone not involved in the food business will be immediately banned from speculating on rice prices, he said.

Thailand will gradually sell 2.1 million tons of the grain stored in state warehouses to domestic consumers as the government tries to keep a lid on soaring prices, Prime Minister Samak Sundaravej told reporters today in Bangkok.

The country hasn't limited overseas sales and plans to ship 9 million tons this year, raising concern that there may not be enough local supply to keep down prices. The government plans to rebuild stockpiles with supplies from the new harvest.

`Unprecedented Challenge'

Demand from nations including China and India, coupled with adverse weather and trading by speculators, is driving food costs higher, the European Union said yesterday. Global food prices surged 57 percent last month from a year earlier, according to the United Nations, and the World Bank has said the increases may trigger civil disturbances in 33 countries.

UN Secretary-General Ban Ki-moon said today he will chair a new task force to tackle the situation.

The crisis is an ``unprecedented challenge'' that has ``multiple effects on the most vulnerable,'' Ban told a press conference in the Swiss capital of Bern. ``We must feed the hungry,'' and ``full funding'' is needed, he said.

Ban is attending a two-day meeting with UN development agencies. Food prices are creating the biggest challenge the UN World Food Program has faced in its 45-year history, ``threatening to plunge more than 100 million people on every continent into hunger,'' the agency said April 22.

---Bloomberg

LaoPo

[Spee]

Rice Declines as Seeding Accelerates in the U.S., Exports Slow

By Jae Hur and Tony C. Dreibus

April 29 (Bloomberg) -- Rice fell to the lowest in almost two weeks after a government report showed U.S. planting accelerated last week and grain sales slowed, easing concern of a global food crisis.

---Bloomberg

LaoPo

A "global crisis" comes and goes in two weeks???? Gimme a <deleted>' break!

No offense intended to the messenger, LaoPo, but if this kind of "reporting" (and I use the term loosely) came in email form, most email filters would label it as spam and put it directly into the junk mail folder. What nonsensical government propagandized drivel! Oh, I see. It came from Bloomberg. What else should be expected?

It reminds me of what a very wise author once said when discussing misinformation and disinformation propaganda campaigns: "A confused society is a controllable society."

[LaoPo]

Rice Declines as Seeding Accelerates in the U.S., Exports Slow

By Jae Hur and Tony C. Dreibus

April 29 (Bloomberg) -- Rice fell to the lowest in almost two weeks after a government report showed U.S. planting accelerated last week and grain sales slowed, easing concern of a global food crisis.

---Bloomberg

LaoPo

A "global crisis" comes and goes in two weeks???? Gimme a <deleted>' break!

No offense intended to the messenger, LaoPo, but if this kind of "reporting" (and I use the term loosely) came in email form, most email filters would label it as spam and put it directly into the junk mail folder. What nonsensical government propagandized drivel! Oh, I see. It came from Bloomberg. What else should be expected?

It reminds me of what a very wise author once said when discussing misinformation and disinformation propaganda campaigns: "A confused society is a controllable society."

Is there ANY 100% reliable news source in the world ? I'm curious.

Global news agencies depend on what kind of information is supplied and/or available; whether from governments, organizations, companies etc.

The news, supplied by 99% of the governments, worldwide, AND companies is -more or less- unreliable but is there any other option ?

We are lied upon day-in-day-out by the governments we chose(d) ourselves ....

LaoPo

[Plus]

Ammar Siamwalla of TDRI is also of an opinion that the current high prices are temporary and unsustainable, there was one other Thai economist who thinks the same.

Basically they think current price surge is a fluke, mostly result of weather spikes.

>>>>

Rising price of fertilisers is bound to push prices up, but Thailand is less dependent on them than other major rice producing countries. Suddens draughts are more dangerous for short term instability and next time Thailand could be on the receiving end.

[LaoPo]

Rising price of fertilisers is bound to push prices up, but Thailand is less dependent on them than other major rice producing countries. Suddens draughts are more dangerous for short term instability and next time Thailand could be on the receiving end.

Why ?

LaoPo

[Plus]

Thailand's low productivity is mainly due to less dependence on fertilisers. They could harvest as much as Japan per rai if they pumped in an equal doze of chemicals.

[Spee]

Rice Declines as Seeding Accelerates in the U.S., Exports Slow

By Jae Hur and Tony C. Dreibus

April 29 (Bloomberg) -- Rice fell to the lowest in almost two weeks after a government report showed U.S. planting accelerated last week and grain sales slowed, easing concern of a global food crisis.

---Bloomberg

LaoPo

A "global crisis" comes and goes in two weeks???? Gimme a <deleted>' break!

No offense intended to the messenger, LaoPo, but if this kind of "reporting" (and I use the term loosely) came in email form, most email filters would label it as spam and put it directly into the junk mail folder. What nonsensical government propagandized drivel! Oh, I see. It came from Bloomberg. What else should be expected?

It reminds me of what a very wise author once said when discussing misinformation and disinformation propaganda campaigns: "A confused society is a controllable society."

Is there ANY 100% reliable news source in the world ? I'm curious.

Global news agencies depend on what kind of information is supplied and/or available; whether from governments, organizations, companies etc.

The news, supplied by 99% of the governments, worldwide, AND companies is -more or less- unreliable but is there any other option ?

We are lied upon day-in-day-out by the governments we chose(d) ourselves ....

LaoPo

EXACTA-MUNDO!!!

Read everything you can. Watch everything you can. Listen to everything you can.

But one should always make one's own judgments and decisions.

As you suggest, quite correctly I would agree, people only report what is given to them by others or by what they themselves observe or care to opine.

Ergo, does anyone in their right mind actually believe there is a rice shortage in the world, or a shortage of any other food crop for that matter? I think that answer is very clearly no. The yield of most modern agricultural nations has steadily increased with technology.

The only times there are problems with food supplies anywhere in the world is when there is heavy-handed government interference, whether through subsidies, restraint of trade, intentionally starving one's own peoples, or many other common examples.

It is up to the individual to take charge. When the majority of individuals do so, there becomes automatic strength in numbers without any intentional coersion or force or planned intent. It just what happens when individuals are free to choose.

[LaoPo]

Thailand calls for a rice cartel

Thailand wants to form an Opec-style rice cartel to give it more control over international rice prices.

The world's biggest rice exporter plans to talk to Laos, Burma, Cambodia and Vietnam about co-operating on prices.

Rice prices have tripled so far this year with countries such as India and Vietnam restricting their exports.

A Thai government spokesman confirmed that the cartel idea had been discussed in talks between the prime ministers of Thailand and Burma on Wednesday.

Export cuts

"With the oil price rising so much, we import expensive oil but sell rice very cheaply and that's unfair to us and hurts our trade balance," spokesman Vichienchot Sukchokrat said.

Cambodia has supported the idea of a cartel in the past and the government of Laos has also said it would seriously consider the proposal.

"By forming an association, we can help prevent a price war and exchange information about food security," Cambodia's government spokesman Khieu Kanharith said.

"It's not a good idea, it's a bad idea. It will create an oligopoly and it's against humanity" Edgardo Angara, Philippines senate committee on agriculture

But the proposal has met with opposition from other quarters.

Vietnam's government disputed claims that a cartel was close, telling the Bangkok Post that Thai negotiators scheduled to visit Vietnam to discuss the issue last month had not turned up.

Vietnam announced in March that it would cut its exports by 22% this year, although it said that was to make sure there was enough for domestic consumption rather than to manipulate prices.

The Philippines, the world's biggest importer of rice, also raised objections.

"Almost three billion people are rice eaters," said Edgardo Angara, chairman of its senate committee on agriculture.

"It's not a good idea, it's a bad idea. It will create an oligopoly and it's against humanity."

'Not like oil'

The president of Thailand's own Rice Exporters Association also criticised the idea.

"When there is a crisis with rice, they [the government] talk about this cartel," Chookiat Ophaswongse said.

"You cannot control farmers growing or not growing rice. It's not like oil."

The United Nations World Food Programme has described rising food prices as a "silent tsunami" hitting poor countries.

Poor harvests, rising demand from growing populations as well as hoarding on the expectation of further price rises have all been blamed for soaring prices.

The price of regional benchmark Thai grade B rice rose above $1000 a tonne for the first time last month, up from $383 in January.

The idea of a south-east Asian rice cartel has cropped up periodically for several years but political differences have so far prevented its creation.

http://news.bbc.co.uk/2/hi/business/7379368.stm

LaoPo

[LaoPo]

Brazil to Auction 55,000 Metric Tons of Rice, Ministry Says

By Diana Kinch

May 4 (Bloomberg) -- Brazil's state-owned National Supplies Co. will auction 55,000 metric tons of rice tomorrow, the country's ministry of agriculture said.

The government currently has 1.4 million tons of rice, equivalent to 10 percent of Brazil's annual consumption, the ministry said in an e-mailed statement. The stocks to be auctioned are held in Rio Grande do Sul and Santa Catarina states, it said.

The measure will help keep prices down and establish a reference price for rice, the statement said, citing Paulo Morceli, basic foods manager of Conab, as the supplies company is known. According to information on the Conab Web site, the rice will be auctioned at 28 reais ($16.98) for a 50-kilogram bag.

Jose Maria dos Anjos, sales and supplies director at the ministry, denied Brazil faces a rice shortage, according to the statement. ``By February 2009, the end of the next rice cycle, the domestic market will have supplies of 13.8 million tons of rice,'' dos Anjos is reported as saying.

---Bloomberg

LaoPo

[LaoPo]

Philippines Cancels Rice Tender

By Luzi Ann Javier

May 5 (Bloomberg) -- The Philippines, the world's biggest rice importer, canceled a tender to buy 675,000 metric tons after only one company submitted an offer amid limited global supplies. Grain futures rebounded in Chicago.

Vietnam Southern Food Corp. was the only company to offer the grain, National Food Authority Deputy Administrator Vic Jarina said. The authority will wait until the ``market softens'' before holding another tender, possibly in the second half, he said today.

The Philippines failed to fill a tender last month, helping rice prices rise to a record in Chicago on April 24. Philippine Agriculture Secretary Arthur Yap said on May 2 that today's planned purchase was intended to boost stockpiles and the country was prepared to reject offers if it deemed prices were too high.

``Global supply until the end of the year will remain tight,'' Chookiat Ophaswongse, president of the Thai Rice Exporters Association, said in a telephone interview. The Philippines ``will probably need to issue another tender.''

Thailand, the world's largest rice exporter, and Vietnam both signaled that they would not take part in today's tender. The Thai government couldn't guarantee contracts, the commerce ministry said on April 28.

Rice, the staple food for half the world, surged 90 percent on the Chicago Board of Trade in the past year on higher demand and export curbs by some nations, including Vietnam. The most- active contract, which advanced to a record $25.07 per 100 pounds on April 24, rose 14.5 cents, or 0.7 percent, to $21.09.

`Any Price'

The surge in the price of rice and record energy costs have stoked concern that global poverty may increase and social unrest may spread. Ministers from Association of Southeast Asian Nations, which includes the Philippines, Thailand and Vietnam, agreed May 3 to work together to cope with rising rice prices.

Yap's statement that the Philippines may reject bids if prices were too high may have discouraged potential suppliers, said Luz Lorenzo, an economist at ATR-Kim Eng Securities Inc. in Manila, the Philippine capital.

``When the government was willing to buy at any price, it attracted a lot of bidders,'' Lorenzo said by phone. ``There's less willingness now to pay top price.''

Twelve companies including suppliers from Thailand and Vietnam offered on April 17 to sell the Philippines 325,750 tons of rice at prices ranging from $872.50 a ton to $1,220, including freight costs. The nation had sought 500,000 tons, prompting the government to raise the amount it was seeking today.

`Critical Volume'

``We've already procured the critical volume of 1.713 million tons'' needed to fill the gap in supply, Jarina told reporters in Manila this morning as the tender details were announced. That volume included imports bought with loans from the U.S., he said.

The Philippines will likely hit a production target of 17.3 million tons of rough rice this year, Yap also said on May 2. That's equivalent to 11.2 million tons of milled rice. The nation's demand for the grain is about 12 million tons a year.

The National Food Authority, which has been authorized to import up to 2.1 million tons of rice this year, is in talks to secure an extra 300,000 tons, including 100,000 tons from the East Asian Emergency Rice Reserve, Jarina said by phone this afternoon.

If the government fails to secure the additional supplies and prices fall, ``we may do the tender in the third quarter, or the fourth quarter,'' Jarina said by phone. The price may drop between August and September as Thailand and the U.S. harvest second crops, Jarina said in the interview.

Rising food prices are creating ``a silent tsunami'' and threatened to plunge more than 100 million people on every continent into hunger, the World Food Programme said last month.

United Nations Secretary-General Ban Ki-moon is to chair a new UN task force to counter the effects of soaring food prices. There was ``mounting hunger and increasing evidence of severe malnutrition,'' Ban said April 29.

---Bloomberg

LaoPo

[PeaceBlondie]

These negotiations to buy critical supplies of essential grains require incredible levels of wisdom and intelligence. Which some leaders sorely lack. As always, lives hang in the balance while corrupt politicians balance bribes.

[LaoPo]

Rice Trades at Daily Limit for Third Day on Demand, Myanmar

By Rattaphol Onsanit and Luzi Ann Javier

May 9 (Bloomberg) -- Rice surged for a third day by the maximum allowed as Nigeria and the Philippines, the two largest importers, sought shipments, further straining global supplies after a cyclone devastated crops in Myanmar.

Nigeria is looking for 500,000 metric tons of Thai rice, said Bhartendu Pandey, a trader at Thai Maparn Trading Co. The Philippines is in talks with Thailand and Vietnam, National Food Authority spokesman Tomas Escarez said today.

Rice advanced for a sixth day in Chicago, trading within 6.7 percent of the all-time high reached April 24. Flooding from the May 3 cyclone may hamper Myanmar's main rice-planting season. Rice, wheat and corn have risen to records this year, prompting the United Nations to call for emergency action to relieve a global food crisis that has caused riots from Haiti to Egypt.

``The cyclone damage in the country has again highlighted tight global supplies of rice,'' Kenji Kobayashi, an analyst at Kanetsu Asset Management Co., said by telephone from Tokyo today. ``The rice price is now set to retest the previous peak.''

Rice rose $1.15 to $23.50 per 100 pounds on the Chicago Board of Trade. The contract, which has more than doubled in the past year, reached a record $25.07 on April 24.

Nigeria, the world's second-largest rice importer, on May 7 suspended levies on imports for six months and offered subsidized seedlings to farmers to curb rising food prices.

Thailand, the biggest rice exporter, is the only shipper that hasn't curbed exports this year as the World Food Programme warns of a ``silent famine'' caused by spiraling food prices. Palm oil and soybeans have also risen to records this year on increased demand from consumers and investors.

Commodity Indexes

Money in funds tracking the two most popular commodity indexes jumped 48 percent so far this year, Sanford C. Bernstein & Co. said April 30. Investments following the Standard & Poor's GSCI index and Dow Jones-AIG Commodity Index have risen to $250 billion from $169 billion at the start of the year.

French Agriculture Minister Michel Barnier on May 7 urged limits to speculation in food-related commodities. India banned futures trading in commodities including soybean oil and rubber.

Wheat for July delivery rose 16.25 cents, or 2 percent, to $8.3825 a bushel as of 4:40 a.m. in Chicago, while corn advanced 6.75 cents, or 1.1 percent, to $6.37 a bushel. Soybeans added 11.75 cents, or 0.9 percent, to $13.2175 a bushel.

About 33 percent of U.S. corn will be used for fuel including ethanol during the next decade, up from 11 percent in 2002, the U.S. Department of Agriculture estimates.

Rice ``will go up further,'' said Thai Maparn's Pandey, speaking by phone from Bangkok. ``India and Vietnam are not going to supply anything.''

Overseas Sales

India's Commerce Secretary G.K. Pillai told reporters today that India, the world's second-biggest rice producer after China, may partly ease its ban on overseas sales.

Thailand agreed yesterday to sell 500,000 tons of rice to Malaysia.

The Philippines, the world's biggest rice importer, was in talks with Thailand and Vietnam for long-term contracts that would allow the National Food Authority to buy the staple through government-to-government agreements, possibly eliminating the need for more tenders this year, spokesman Escarez said.

The Philippines canceled on May 5 a tender to buy 675,000 tons of rice to build stockpiles after just one company submitted an offer. Japan offered to ship 60,000 tons of rice to the Philippines to help the nation boost stockpiles, Escarez said.

Philippine food companies, including Jollibee Foods Corp., and farmers' cooperatives sought today to buy 21,560 tons of rice from Thailand and China, according to National Food Authority Assistant Administrator Conrad Ibanez. That's less than 8 percent of the total of private-sector shipments allowed this year.

Speculation Stoked

The damage from Cyclone Nargis in Myanmar's main rice- growing area has stoked speculation, including from the Thai Rice Exporters Association, that the country may be forced to abandon exports and seek supplies on the international market.

Myanmar had been expected to export 600,000 tons of rice this year, the Food and Agriculture Organization has said. The Rome-based United Nations agency had forecast world rice exports at 29.9 million tons.

The five provinces that bore the brunt of the typhoon account for about two-thirds of the nation's rice output. The storm flooded 5,000 square kilometers (1,930 square miles) of farmland in the Irrawaddy delta.

Rice may exceed $30 per 100 pounds in Chicago, Kanetsu's Kobayashi said.

Still, ``I don't see that this rally in rice prices will be sustained,'' said Simon Roberts, head of agricultural commodities at ANZ Banking Group Ltd. ``You'll see a supply response at some point to these prices.''

---Bloomberg

LaoPo

[LaoPo]

Rice Slumps on Supply, Heads for Biggest Weekly Drop Since 2004

May 16 (Bloomberg) -- Rice slumped for a fifth day, heading for the biggest weekly decline in almost four years, as the prospect of exports from Pakistan and Japan eased concern that a global food shortage is worsening.

Pakistan, the fifth-biggest exporter, will permit shipments of 1 million metric tons because local needs have been met, Mohammad Azhar Akhtar, chairman of the Rice Exporters Association of Pakistan, said yesterday.

The staple for half the world reached a record last month as some exporters including Vietnam and India cut sales to guarantee local supplies, stoking concern that hunger and unrest may spread. The price fell 14 percent this week, the biggest weekly drop since July 2, 2004, according to Bloomberg data.

``Rice prices appear to have already peaked,'' Kazuhiko Saito, a strategist at Interes Capital Management Co. in Tokyo, said by phone today. ``Some exporters may resume their sales before producers in Asia harvest new crops.''

Rough rice for July delivery fell as much as $1.02, or 5 percent, to $19.32 per 100 pounds, the lowest since April 2, on the Chicago Board of Trade. The contract, which reached a record $25.07 on April 24, traded at $19.705 as of 10 a.m. in London.

``The wheels are in motion for lower food prices,'' John Reeve, associate director for agricultural commodities at UBS AG, said today in an interview on Bloomberg Television. Farm output costs were below selling prices and harvests were due, he said.

Export Curbs

The surge in rice prices, coupled with record energy and wheat costs, had stoked concern about a global food crisis as basic goods cost more than the poor could afford. The Food and Agriculture Organization estimated May 12 the global rice trade will drop 7.1 percent this year to 28.8 million tons.

Japan is in talks with the Philippines, the world's largest importer, about shipments from Japan's stockpiles of overseas rice, according to a government official, who declined to be identified in remarks reported May 12.

``The supply news from Japan and Pakistan has eased concerns,'' Hiroyuki Kikukawa, general manager of the research department at IDO Securities Co., said today from Tokyo. ``The supply news has helped keep speculators from hoarding.''

Pakistani rice exporters ``can easily sell'' about 1 million tons on the international market, Akhtar of the South Asian nation's rice exporters group said yesterday. Shipments had been halted from May 2, the Business Recorder reported on May 6.

The South Asian country, which has about 3 million tons of surplus rice this year, had set a minimum export price for some premium rice grades to boost local availability. Traders were seeking new export contracts after complying with directives to sell rice at home, Akhtar said on May 7.

Bumper Crop

India, the world's second-biggest rice producer after China, may partly ease its ban on rice exports as the country is set to harvest a bumper crop, Commerce Secretary G.K. Pillai told reporters May 9. Indian output in the year ending June may reach a record 95.68 million tons, the farm ministry said April 22. That compares with 93.35 million tons produced a year earlier.

Food prices, including rice, have surged on increased demand, rising incomes and speculative interest from hedge funds, Jacques Diouf, director-general of the United Nations Food and Agriculture Organization, told reporters in Tokyo today.

``There's the speculative hedge funds, which have added to driving up food prices in the Chicago market,'' Diouf said at a press conference. ``Agricultural assistance is a crucial element for solving the present crisis.''

Global milled rice output will rise 1.4 percent to 435 million tons, the FAO said in a report on May 12.

`World Planting'

``World planting acres for rice have been increasing following recent record prices,'' said Saito, the strategist at Interes Capital Management.

Rice prices had also gained earlier this month after a cyclone slammed into Myanmar's main rice-growing region on May 3, inundating farmland and fueling speculation that the nation will be forced to halt exports. The impact of Cyclone Nargis had been factored into global rice prices, Sunny Verghese, chief executive officer of commodity supplier Olam International Ltd., said today.

``Myanmar used to contribute about 5 to 6 percent of the world rice trade,'' Verghese said in an interview. ``The new crop, I don't think they will export.''

---Bloomberg

LaoPo