Global rice consumption may exceed production
IN 2004-05, for the fourth consecutive year, global
rice consumption is expected to exceed production. As
a result, the ending stocks are likely to see the lowest
levels in almost two decades.
Tightening supplies and resultant drawdown of stocks
are, however, unlikely to impact world prices significantly,
unless of course China changes its position, that is,
stops exporting and starts importing more rice.
In its latest report, the US Department of Agriculture
has forecast world rice production in 2004-05 at 397.3
million tonnes (386.9 mt), while consumption is placed
at 413 mt, unchanged from the previous year.
End-stocks are projected at 68 mt (83.7 mt), the lowest
since 1983-84. World trade is projected little changed
from the previous year at 25 mt
Vietnam and Myanmar are likely to boost their rice
exports to fill the void created by lower exports from
China and India. Thailand is unlikely to increase its
2004 rice shipments beyond the anticipated record of
9 mt as supplies shrink.
Rice export prospects from India are not rated bright.
Kharif season output may be affected by some measure
because of aberrant monsoon in July, although copious
rains in August have contained the extent of loss.
An ambitious target of 93.5 mt has been fixed for 2004-05,
but actual output is sure to fall short. In 2003-04
rice production was 86 mt. The volume of procurement
will have to be watched too. On July 1, buffer stock
level was 10.7 mt versus the minimum norm of 10.0 mt.
The Government is already under pressure because of
inflationary tendencies in the economy. So, for the
time being at least, open market sale by the Food Corporation
of India at highly subsidised prices for export is ruled
out.
During fiscal 2003-04, non-basmati rice exports were
2.6 mt valued at Rs 2,142 crore, considerably down from
4.1 mt worth Rs 3,634 crore the previous year. In the
current fiscal, shipment volumes may drop further.
For purpose of export, private parties are allowed
to purchase rice directly. The Centre is in the process
of formulating a grain export policy which is likely
to include an element of subsidy in the form of reimbursement
of certain costs. However, given current market conditions,
rice exports from the country are unlikely to be substantial.
Source: Business
Line, August 30' 2004
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