The nation's rice farmers are slashing prices on the local staple as imports eat away at the long-protected market, an industry insider said yesterday.
"In an effort to compete with rice imports and retain market share, farmers are cutting prices significantly," said an official at the Taipei Rice Association, who asked to only be identified by her surname, Lee.
The group represents some 800 rice wholesalers in Taipei County.
Lee added that compared with the same season last year, the wholesale price on newly-harvested rice was down 50 percent at NT$10 per kilo.
"The price of rice is very unstable as farmers are confused as to what is a fair price at this moment," Lee said.
In accordance with WTO entry agreements, Taiwan is set to import 144,700 tonnes of foreign rice this year, accounting for 8 percent of the nation's annual consumption.
As of July this year, some 70,000 tonnes of rice imports have come ashore from the US, Australia, Thailand and Japan, according to the Council of Agriculture (COA).
Next year, the 8 percent ceiling is expected to be raised -- a decision being discussed between the COA and other WTO members.
The market is expected to become even more competitive in the future.
"Competition between local rice merchants was already serious before Taiwan entered the WTO. So now its even tougher to make a living selling rice," the association's Lee said.
A surplus of rice in the market may also be behind the panic, one official said.
"It's definitely a case of over-supply ? the amount of locally-grown rice can sufficiently meet annual demand," said Lee Cheng-mau (
The government has been actively working to persuade farmers to cultivate other crops.
The council has also outlined a plan to shrink Taiwan's annual rice output by reducing the amount of total land area used for rice farming by 50,000 hectares over the next few years.
Some 330,000 hectares of land is devoted to growing rice nationwide.
"Farmers don't have to panic ? after all, the government will buy up unsold rice at reasonable prices," he said.
Meanwhile, retail market professionals said public acceptance of rice imports is mushrooming.
"We are seeing steady growth in demand for rice imports which make up nearly 10 percent of our rice sales," said Debbie Yao (姚美蘭), marketing manager at Far Eastern Geant Co (愛買吉安), a French and Taiwanese joint venture operating 13 hypermarts around the country.
Consumers favor Thai rice, Yao said, since it ranks as the cheapest of the imports at NT$49 a kilo. Geant sells Taiwanese rice for between NT$32 to NT$36 per kilo.
Rice from the US and Australia sells for NT$63 a kilo and premium Japanese rice goes for NT$250 per kilo.
As has often been the case in Taiwan, imports spur a craving to try something new.
"Consumers like to try new things partly because they are curious and partly because they seem exotic," said Lilian Lee (
She forecasts price competition will really heat up next year. However, Geant's Yao said she expected Taiwanese to remain very supportive of local rice.
"In terms of price, local rice is still very competitive and since people consume rice everyday, price is very important," Yao said.
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