The Hindu Business Line : Rice production to reach new highs

NEW YORK: Rice production in Asia, Africa and Latin America would reach record highs in 2008, but prices would continue to soar in the short term, the United Nations Food and Agriculture Organisation (FAO) said on Tuesday.

The agency's preliminary forecasts show that harvests would surge by 2.3 per cent this year, reaching an all-time high of over 600 million tons, but prices would remain high in the immediate future because a large portion of this year's crop would only b e harvested at the end of 2008.

FAO also warned that the destruction of Myanmar's food basket by the devastating Cyclone Nargis which struck the South-East Asian nation last week, could lead to a worsening of the production of rice globally.

The cyclone which flooded rice-growing areas and destroyed several warehouses and stocks hit Myanmar as paddy farmers were harvesting the dry season crops, which accounts for 20 per cent of annual rice production.

Prices of rice in Yangon have skyrocketed by 50 per cent, and if the country turns to its neighbours such as Thailand and Vietnam for imports, this could lead to a further upward pressure on global prices.

According to the FAO rice price index, international prices soared by 76 per cent between December 2007 and April 2008.

"Prices are expected to remain extremely firm, at least until the third quarter of 2008, unless restrictions on exports are eased in the coming months," said FAO rice expert Concepcion Calpe.

In a bid to prevent shortages in their own countries, major rice exporters have recently set export bans, taxes or ceilings. - PTI

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