Home / World Business
Sat, Mar 29, 2008 - Page 10 News List

India raises minimum rice export price

FALLING INVENTORY Rice importers from Nigeria to the Philippines are at risk as prices surge and exporters such as China and Vietnam curb outbound shipments

BLOOMBERG

India, the world's second-biggest rice producer, increased the minimum export price for the grain to boost local supplies and curb inflation as global stockpiles of cereals fall to the lowest in more than two decades.

Exporters must ship rice for at least 40,000 rupees, or US$1,000 a ton (0.907 tonne), excluding freight, which compares with US$650 a ton previously, the trade ministry said in a statement. The price for aromatic Basmati rice was raised to US$1,100 a ton.

Record prices are threatening food security in rice-buying nations from the Philippines to Nigeria and are driving up costs for producers, including Anheuser-Busch Cos, the biggest US buyer of the grain, and cereal maker Kellogg Co. Vietnam, China and Egypt are restricting rice exports, and South Korea will release grain from state-controlled reserves to cool prices.

"Not just India, but governments across the globe are taking steps to keep prices of staple foods under control," said Atul Chaturvedi, president of Adani Enterprises Ltd, India's biggest private exporter of farm goods. "It's clearly the result of the fight for food and fuel."

The Food and Agriculture Organization said last month that 36 nations, including China face food emergencies this year. World rice stockpiles may total 72.1 million tonnes by the end of July, the lowest since 1984, the US Department of Agriculture said.

Rough rice prices have almost doubled on the Chicago Board of Trade in the past year. Rice for delivery in May rose as much as US$0.48, or 2.5 percent, to a record US$19.785 per 100 pounds (220kg) in Chicago yesterday. Wheat reached US$13.495 a bushel on Feb. 27, its highest-ever.

"Food prices all over the world are going through the roof and so spread the risk of social unrest," investor Jim Rogers said in Singapore yesterday. "It doesn't matter where, everybody has to pay higher prices for food and that's causing a problem."

Consumer prices in China, the world's fastest-growing major economy, soared to 8.7 percent last month, the fastest pace in 11 years. In Thailand, prices jumped the most in 20 months, and in Vietnam, inflation is its highest in more than a decade.

Rising prices and shortages of food staples have been felt outside Asia. In Argentina, farmers blocked highways and access to ports and warehouses to protest rising export taxes, leading to a shortage of meat. The nation is the world's second-largest corn exporter and the third-largest soybean supplier.

The Philippines, the world's biggest rice buyer, may reduce the import tax on the grain to as little as 10 percent from 50 percent, Finance Secretary Gary Teves said in an interview yesterday. Sri Lanka scrapped customs duty on rice imports, the state-owned Daily News reported yesterday.

This story has been viewed 4173 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top