Developing Countries Will Lead Global Rice Import Growth in 2013-22, Says USDA Rice growers positive California MG prices are UP Russia MG Harvest coming to end Egypt open rice exports Vietnam’s rice export in tough competition with India Thai rice exports in May Rise Above Target This Year Viet-Nam Rice exports likely to fall this year
Australia Medium Grain Rice #1 $ N/A    Egypt 101 #2 $760    Egypt 178 #2 Rice $730    EU Prices Baldo €660    EU Prices LG-A Ariete 5% €550    EU Prices MG Lotto 5% €500    EU Prices RG Balilla 5% €500    Russia Rapan $ 700    USA Jupiter Paddy $375    USA Calrose #1 Paddy $480    USA Jupiter Rice $630    USA Calrose #1 $830   

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Taiwan Rice Situation
Rice Production

Under the current WTO agreement, the rice TRQ quota amount is 144,720 tons on a brown rice basis (126,000 tons on a milled basis). Taiwan has set its targeted rice production remains slightly above 1 million tons on a targeted production area of 258,000 hectares to accommodate its rice TRQ imports. There are no out-of-quota imports recorded because of the very high out-quota-tariff rate of NT$45/kg. Under the TRQ, imported rice prices are about half of locally produced rice. In 2006, domestically grown rice in the wholesale market was priced on average NT$25.74/kg, compared to c.i.f. price at NT$15.40/kg for U.S. rice and NT$11.32/kg for Thai rice on a brown basis. In each year, there only are minor variations in production areas and yields.

Consumption Per capita milled rice consumption in 2005 is 48.60 kilograms, about the same as previous year, according to Taiwan’s Council of Agriculture (COA). Estimated per capita consumption for 2006 and 2007 remains at this level. Market promotions are unlikely to increase total demand, but could shift rice significantly between varieties and origins. In addition to human consumption, there are about 11,000 tons for seeding and 60,000 tons in 2005, 130,000 tons in 2006 and estimated 60,000 tons for feed use. Taiwan feed industry strongly petitioned to Taiwan agricultural authority for releasing old rice for feed use when the world corn price surged in 2006.

Import Regime In 2003, Taiwan switched its import regime to a Tariff Rate Quota (TRQ) system from the Minimum Market Access (MMA) system used in 2002, its first year in the WTO. The total quota amount remains at 144,720 mt on a brown rice basis (equivalent to 126,000 tons on a milled rice basis). Of this total, 65 percent is reserved for government purchases and 35 percent for the private trade. All grain dealers who have registered with COA and have a grain dealer license may bid for rice import quotas. The out-of-quota tariff rate is NT$45/kg for rice and NT$49/kg for processed rice products, with conversion factor of 1.15 to convert from milled or processed products to brown rice. Taiwan’s change to a TRQ system was submitted to the WTO in October 2002. In December 2002, it passed enabling legislation without prior consultation with WTO members, triggering a formal objection from the U.S., Australia, and Thailand in Geneva. The objections were based on Taiwan’s lack of consultation, the removal of previous negotiated WTO head note language and associated concessions, and the extremely high out of quota duty. Taiwan and its trading partners continue to make progress in resolving the issue. Although Taiwan has switched to a TRQ regime, it has fulfilled its obligation to import the full quota amount of rice; with virtually 100 percent fill rates for quotas both in public and private trade. It, however, has been unable to fill its public sector quota by the end of the calendar year in 2005 and 2006 due to legislated ceiling price requirements. See Table 6 below for quota fill data.

Public Sector Imports

In October 2006, Taiwan announced its first Simultaneous-Buy-Sell (SBS) rice tender for ten thousand tons under the 2006 public sector quota. The process is designed for multiple winners and contracts are awarded to bidders who offer the highest mark-ups in terms of the difference between import and market price. The SBS tender is not associated with a grain specification so that it is tendered for all types and forms of rice. In 2006, only 1,480 tons out of target 10,000 tons was successfully tendered to three importers since SBS was first time introduced to the rice trade industry. The rest target SBS quota has been translated into normal tenders. Twenty thousand metric tons of rice under the 2007 public sector quota will be tendered under (SBS) system. As of reporting day, Taiwan has contracted 1,500 tons of its 2007 SBS tender for delivery by December 31, 2007. The tender schedule for the remaining 74,068 tons under the 2007 public sector quota will be announced shortly.

About the 2006 public sector quota tender schedule, as of reporting day, Taiwan has successfully tendered and contracted 78,248 tons or 83 percent of its 2006 public sector rice quota. The remaining 13 percent of the 2006 public sector quota is divided into two biddings, one for 14,000 tons of medium grain and the other 1,820 tons for short or medium brown. These two bids failed a couple times due to offered bid prices exceeded ceiling prices.

Taiwan is bound by government purchase regulations and will continue the tender process until these two tenders succeed. At this point, the United States has a 75 percent share of the public sector quota. The United States continues to dominate the public rice trade, with a 75, 75, 83 and 80 percent shares in 2002-2005 public imports, respectively. It is anticipated that the remaining 2006 public sector quota rice of 94,068 tons on a brown basis will enter Taiwan during 2007. In 2006, Taiwan delayed its completion of public rice tenders because offered bidding price exceeded the set ceiling price. Approximately 65,000 tons on a brown basis of the 2005 public sector quota rice entered into 2006 imports based on Taiwan Customs data.

Private Sector Imports

Under the TRQ, importers bid for quota rights that are sold to the highest bidder. Using the so-called “System Three” quota bidding system, Taiwan has successfully allocated all 50,652 mt (brown basis) of its annual private sector import quota rights to local importers since Taiwan’s entry to the WTO in 2002. Taiwan has allocated two-third of it 2007 quota rights to 72 importers with the bid prices ranging from NT$7.603/kg to NT$14.500/kg (brown basis).

The remaining one-third of the 2007 private sector import quota will be allocated on April 30 thru competitive bidding. The specific quota allocation results for the private trade were reported in GAIN TW7012. Prices in 2007 were significantly lower than the level of 2006 due to higher domestic supply. The cost for quota rights reflects conditions in the local and international rice markets – higher local relative prices make import rights more valuable and vice versa. The private quota has been 100 percent filled. Taiwan did not even have to use its quota reallocation mechanism in last two years, which redistributes unused import rights. Only a few quota holders, who failed to import rice before September 15, had to request extension of their quota rights to the end of year.
MGR Archive 6.5.2007
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Russia Rapan $ 700
USA Jupiter Rice $630
USA Calrose #1 $830
USA Calrose #1 Paddy $480
EU Prices Baldo €660
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