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
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Orphaned by rice cartel
Five rice producing countries in the Mekong River Delta are setting up a price-fixing cartel amid skyrocketing rice prices and shortages in Asia described by the United Nations as a “real global crisis.” The cartel is expected to isolate the Philippines from its Asian rice suppliers.

The proposed cartel, called Organization of Rice Exporting Countries (OREC), embrace Thailand, Vietnam, Burma, Cambodia and Laos, which have agreed in principle to form a bloc inside the 10-member Association of Southeast Asian Nations, which was designed to cement political and economic solidarity in the region.

The launching of the cartel initiative by Thailand, the world’s biggest rice exporter, could not have come at a worse time for the Asia-Pacific region, where 1.5 billion people, three times the population of Europe, live on less than $2 a day. The Asian Development Bank estimates that the very poorest people in the region spend 60 percent of their income on food and a further 15 percent on fuel, two basic commodities whose prices have risen relentlessly in the past few months.

The food price inflation has hit hardest the poorest in the region and threatens the governments in food-short countries with social unrest. Rising food prices have sparked rioting in parts of Africa and Asia and in Haiti in the past few weeks.

The impact of the cartel plan was immediately felt in the Philippine emergency rice procurement program, which has Thailand and Vietnam as the main suppliers. Less than a week after Thailand said it was considering the formation of the cartel, the rice buying program ran into difficulties. The National Food Authority (NFA) reported that only one company submitted a bid for the supply of 675,000 metric tons to fill its procurement target of 2.1 million metric tons for 2008. The NFA declared the auction “a failure.”

This happened despite claims by Agriculture Secretary Arthur Yap that the Philippine and Vietnamese governments had signed a memorandum of agreement in which the latter pledged best effort to continue supplying rice to the Philippines this year.

Thailand announced last Thursday that it would not join the Philippine tender of May 5 because the Thai government does not endorse private exporters. The announcement came a day after it confirmed that it had agreed with the four other Mekong rice producing countries to form a cartel.

Yap has claimed that the Philippines has signed contracts with the Thai government committing the latter to export rice to the Philippines as part of its procurement program for 1.6 million metric tons to fill up its buffer stock for 2008.

The uncertainty of supply has highlighted the issue of rice security being held hostage to the national interest of rice supplying countries. The Philippines has been reduced to an orphan state, twisting in the squeeze of its neighbors that are looking after their own interests above all else. – Amando Doronila, Inquirer
MGR Archive 11.5.2008
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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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