1 / 42

Rice prices have started to fall – Does it mean that the Rice Crisis is over? An Update and Outlook

Rice prices have started to fall – Does it mean that the Rice Crisis is over? An Update and Outlook. Sushil Pandey. IRRI in the Media, Jan-Aug 2008. Number of times IRRI appeared in international media. 231. 41. 25. 18. Number of times IRRI appeared in international media, Jan-May 2008.

tale
Télécharger la présentation

Rice prices have started to fall – Does it mean that the Rice Crisis is over? An Update and Outlook

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Rice prices have started to fall – Does it mean that the Rice Crisis is over? An Update and Outlook Sushil Pandey

  2. IRRI in the Media, Jan-Aug 2008

  3. Number of times IRRI appeared in international media 231 41 25 18

  4. Number of times IRRI appeared in international media, Jan-May 2008

  5. World price of milled rice (Thai 100%B), May-August 2008 Source of raw data: Pink sheet, World Bank

  6. Rice price fluctuation and IRRI coverage in international media, 2008 Rice export price ($/t)

  7. Weekly wholesale price of regular milled rice in Philippines, Jun-Aug 2008 Source of raw data: BAS, Philippines

  8. Future market rice price (milled equivalent) at Chicago Board of Trade $747 $480 $330 Data source: Chicago Board of Trade, August 2008

  9. Does this mean that the rice crisis is over now? • The answer is a resounding “NO”.

  10. A quick overview

  11. Monthly export nominal price of Thai rice (100% B), Jan 2006- May 2008 Vietnam imposed partial export ban (1st wk Sep 2007) Source: Trade and Markets Division, FAO and Pink sheet, World Bank (Accessed on August 2008) Rice export price is based on the Thai rice 100%B second grade

  12. Monthly export nominal price of Thai rice (100% B), Jan 2006- May 2008 India raised MEP, $500/t (4th wk Dec 2007) India raised MEP, $450/t (2nd wk Nov 2007) India imposed export ban, Min. export price, $425/t (2nd wk Oct 2007) Vietnam imposed partial export ban (1st wk Sep 2007) Source: Trade and Markets Division, FAO and Pink sheet, World Bank (Accessed on August 2008) Rice export price is based on the Thai rice 100%B second grade

  13. Monthly export nominal price of Thai rice (100% B), Jan 2006- May 2008 Philippines import tender, (4th wk Mar 2008) Vietnam tightened export restrictions (4th wk Mar 2008) India raised MEP, $500/t (4th wk Mar 2008) India raised MEP, $650/t (2nd wk Mar 2008) Vietnam raised MEP, $500/t (1st wk Mar 2008) India raised MEP, $500/t (4th wk Dec 2007) India raised MEP, $450/t (2nd wk Nov 2007) India imposed export ban, Min. export price, $425/t (2nd wk Oct 2007) Vietnam imposed partial export ban (1st wk Sep 2007) Source: Trade and Markets Division, FAO and Pink sheet, World Bank (Accessed on August 2008) Rice export price is based on the Thai rice 100%B second grade

  14. Monthly export nominal price of Thai rice (100% B), Jan 2006- May 2008 Philippines 4th import tender, (3rd wk Apr 2008) Philippines import tender, (4th wk Mar 2008) Vietnam tightened export restrictions (4th wk Mar 2008) India raised MEP, $500/t (4th wk Mar 2008) India raised MEP, $650/t (2nd wk Mar 2008) Vietnam raised MEP, $500/t (1st wk Mar 2008) India raised MEP, $500/t (4th wk Dec 2007) India raised MEP, $450/t (2nd wk Nov 2007) India imposed export ban, Min. export price, $425/t (2nd wk Oct 2007) Vietnam imposed partial export ban (1st wk Sep 2007) Source: Trade and Markets Division, FAO and Pink sheet, World Bank (Accessed on August 2008) Rice export price is based on the Thai rice 100%B second grade

  15. Annual wholesale price (nominal) of regular milled rice, Philippines, 1990-2008 Source of raw data: BAS, Philippines

  16. Supply-Demand imbalance in the world Sources of basic data: FAO, WRS

  17. Global growth in population, consumption Regional growth in consumption compared to production – Africa Price of other food crops – wheat, maize –commodities in general Underlying demand factors

  18. Underlying supply factors • Exchange rate movement • Yield growth leveling off • Rise in oil prices • Biofuel production • Pressure on resources – land, labor, water, diversification, agricultural transformation • Climate – short term, global warming

  19. Slow down in rice yield growth Growth in rough rice production Source of raw data: USDA database online, 2008.

  20. Growth rates of rice yield and population, Asia

  21. Ending milled rice stocks, World, 1960-2008 Source of raw data: PSD Online (www.fas.usda.gov/psdonline/psdhome.aspx), USDA, August 2008

  22. Outlook

  23. Rough rice production outlook, World, 2006-2008

  24. Rice area (Million ha) during 2007/08 to 2008/09, selected countries Source: PSD online, USDA, August 2008

  25. Change in rice area rice from 2007/08 to 2008/09 Source: PSD online, USDA, August 2008

  26. Production and consumption balance of milled rice, World, 1998-2008 Source of raw data: USDA and FAO

  27. Quantity of milled rice export, major exporting countries, Calendar year 2007-2009

  28. Status and Outlook: India • Export ban currently covers • Non-basmati rice, Wheat, Maize, Pulses • Exceptions to some destinations (Bangladesh, Sri Lanka and Nigeria) • No lifting of export ban prior to Nov (most likely to continue until April 2009)

  29. Status and Outlook: Vietnam • Export ban removed from July 2008 but MEP of US$750/ton imposed. • Export tax ($30-$175) was also considered but was removed in the first week of August. • Export shipments are taking place against the old purchases but new sales are not taking place yet as no export license being issued.

  30. Status and Outlook: Thailand • Release of intervention stock (1-2 million tons). • Price quoted is $720-$750/ton, FOB Bangkok. • Early June, Thailand Paddy Purchase Program started (purchase paddy at B14,000/ton or equivalent to $700/ton of milled rice). • Monthly total export in the first half of 2008: 1 million ton

  31. Outlook: domestic and export prices • Thailand: Support price of $700/t • Vietnam: Minimum export price of $750/t

  32. Overall, a very tight demand-supply balance Stock at low level Persistence of nervousness in the market Failure of the Doha Round Some production projections may not be achieved Much will depend on the rice season Rice prices are likely to remain much higher than the 2007 level and volatile Outlook

  33. Impact of rice price rise • 70% of the world’s poor reside in Asia. • Poor people spend 30-50% of income on rice • Price of rice increase by 50% is equivalent to a drop in their real income by 15-25%. • This is a substantial loss in income for poor people who are hovering just above the poverty line.

  34. Impact of 50% increase in rice priceon poverty Based on elasticity estimates derived from ADB(2008) and Ivanic and Martin (2008).

  35. Weekly wholesale price of regular milled rice, Philippines, 2007-08 2008 2007 Source of raw data: BAS, Philippines

  36. Increase in rice prices Monthly export price of Thai rice 5% brokens, 1998-2008 GR = 0.97% Source of raw data: The Pinksheet, World Bank

  37. International price of milled rice, 2007 and 2008 • 2007 average: $326/t • 2008 Aug: $700-$750/t • 2008 (Aug, based on trend): $367/t

  38. An agronomic revolution to reduce existing yield gaps Accelerate the delivery of new post-harvest technologies Accelerate the adoption of higher yielding rice varieties Strengthen rice breeding pipelines for developing new varieties Tap the vast reservoir of untapped genetic resources New generation of rice scientists and researchers for the public and private sectors Increase public investment in agricultural infrastructures Reform policy to improve the efficiency of marketing systems for both inputs and outputs Strengthen food safety nets for the poor Responding to the “rice crisis” in Asia

  39. Key policy issues • Investments in agricultural R&D and agricultural infrastructures • Marketing/trade/stabilization policies and institutions (including gains from value-chain development) • Vulnerability and design of safety nets • Diversification processes and the role of private sector (change from supply-driven to demand-driven paradigm) • Technology dissemination strategies • Organization of farming (farm size, mechanization, tenure security) for higher productivity and efficiency

  40. Quarterly average world price of wheat (US, HRW), 2008

  41. Percentage increase in world fertilizer price between May 2006 and May 2008 Data source:

More Related