Saturday, April 24, 2010

Government to buy surplus rice

Joo Dong-hwa, 68, a farmer, transplants rice at his rice paddy in Yanggu, Gangwon, yesterday. Due to the unusually low temperature rice transplanting in the country started 10 days later than in recent years. [NEWSIS] The government said yesterday that it would buy up to 200,000 tons of rice from local farmers after overproduction caused a recent fall in its price. The Agriculture Ministry will purchase next month 100,000 tons of last year's rice harvest and another 100,000 tons later this year. The surplus rice will be held in state reserves and will be sold on the market once the price stabilizes. Once the purchases are completed, the government rice reserves will amount to more than 900,000 tons, higher than the level recommended for Korea by the UN Food and Agriculture Organization. The government has periodically bought rice to stabilize market prices, with the last such action occurring last October. The government intervention is seen as necessary to prevent the fall in rice prices adversely affecting rural communities. The problem is seen as a long-term one since the per-capita annual rice consumption by Koreans has fallen for 25 consecutive years from 130.1 kilograms (286.8 pounds) in 1984 to 74 kilograms in 2009. The pace of decline has accelerated in the last decade, with per-capita rice consumption dropping by more than 20 kilograms in that period. We have to weigh the cost of buying the rice against the bigger social cost if we left it to the market to decide, said an Agriculture Ministry official who asked for customary anonymity. With the rice supply constantly outstripping demand, the government said it would offer subsidies of 3 million won ($2,704) for each hectare of farmland that is converted from rice to other crops, such as beans and corn. The average price of 80-kilogram rice sack sold to rice-processing facilities has steadily fallen from 144,653 won last October to 139,091 won in March. Rice prices normally rise in February as supplies from the autumn harvest fall.

Rice procurement down at 26.4 mt on lower kharif output

NEW DELHI: Rice procurement by the Government in the current marketing year, ending September 2010, has so far fallen by about three per cent to 26.42 million tonnes compared with the same period previous year, on account of lower production. Food Corporation of India, the nodal agency for procurement and distribution of foodgrains, and state agencies had procured 27.25 mt in the corresponding period previous season, which runs from October to September. The Centre had procured a record 33.68 mt in the entire 2008-09 season. For the 2009-10 marketing year, it kept the procurement target lower than that of the last season at 26 mt in view of less production in the 2009 kharif season on account of drought that hit over 300 districts of the country. With procurement surpassing the initial target of 26 million tonnes, FCI now expects procurement in the 2009-10 marketing year to reach 30 mt. The largest rice contributor to the central pool this season so far has been Punjab, where procurement has increased by about 10 per cent to 9.27 mt compared with 8.46 mt a year ago. Procurement from Chhattisgarh has also increased by 20 per cent to 3.06 mt so far this season from 2.54 mt in the same period last year. FCI has procured 27 per cent more rice from Haryana so far this season, lifting 1.81 mt as against 1.42 mt in the corresponding period last year. On the other hand, procurement from Andhra Pradesh — a major contributor — has declined by 20 per cent to 4.22 mt so far this season from 5.26 mt in the same period last year. Similarly, purchases from Uttar Pradesh so far this season stand at 2.59 mt down 27 per cent from 3.54 mt a year ago. Procurement from Orissa so far this season has also decreased by five per cent to 1.88 mt against 1.92 mt in the same period last year. The Government procures foodgrains at a fixed minimum support price (MSP) to protect farmers from market fluctuations. The MSP for common grade of paddy has been decided at Rs 1,000 per quintal and at Rs 1,030 per quintal for grade A variety, both includ ing a bonus, for the 2009-10 marketing season. India’s rice production is estimated to decline to 87.56 mt in the 2009-10 season from the record level of 99.18 mt in the previous season.

Rice benchmark to rise with market

The government has pledged to increase benchmark prices for rice under its insurance programme so that they are closer to prevailing market rates in order to raise farmers' incomes and shore up local paddy prices. The new benchmark prices would be based on the average market prices of rice sold in different provinces, said Yanyong Phuangrach, the permanent secretary for the Commerce Ministry. Rice prices, particularly for paddy, vary in each province depending largely on moisture content, transport costs and the prices of milled rice. Farmers currently earn 6,500 to 7,200 baht per tonne for paddy with 15% moisture content. Authorities have to pay compensation of 2,800 baht a tonne to farmers, as the benchmark is below the insured price of 10,000 baht. As another option, Mr Yanyong said the ministry would propose to set new benchmark prices using a calculation based on average prices of rice in the past three years, current market prices and futures prices in the three months ahead from the Agricultural Futures Exchange of Thailand (Afet). Under this method, the current benchmark would be 8,918 baht per tonne. The National Rice Policy Committee is scheduled to consider the proposals on Monday. Rice farmers are now pressing their calls for immediate help from the government, as domestic prices have fallen significantly on higher output, while foreign importers are delaying purchases on expectations prices will fall further. Local paddy with 20% moisture is now quoted in the market at only 5,000 to 5,500 baht per tonne, with 15% moisture paddy at 7,000 baht. Before the Songkran festival, 20% moisture paddy was quoted at 5,800 to 6,300 baht, and 15% moisture at 8,000. The price of local milled rice has also fallen from 19,000 baht a tonne in December to 11,800 baht now. Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, agreed that the benchmark prices needed to be raised, especially those based on the market prices, saying the new calculation would better reflect real market prices. Thai rice prices, the benchmark for Asia, have slumped by 5.5% from two weeks ago on lower demand, according to the Thai Rice Exporters Association. The association on Wednesday set the price of 100% grade-B white rice at $482 a tonne, down from $510 on April 7. The price of 25% broken rice was set at $394 a tonne, compared with $421 a tonne two weeks earlier.

Venezuela orders second rice shipment under revised pact

Guyana Rice Development Board (GRDB) General Manager Jagnarine Singh is currently in Caracas signing the purchase order for the second shipment of rice and paddy under the recently revised US$21.7M deal. This was announced by Minister of Agriculture Robert Persaud during a press conference Thursday, during which he addressed the recovery plan for El NiƱo. Persaud said that despite the losses suffered during the dry season Guyana will still be able satisfy its markets. On October 21 last year, the multi–million dollar rice purchase contract for the supply of 50,000 tonnes of rice and paddy to the neighbouring state – at a price higher than current export prices – was signed in the presence of Persaud, Head of the Corporation of Supplies and Services (CASA) of Venezuela Colonel Rudolpho Marco Torres, Singh and other officials of the GRDB. Several weeks after the signing, Singh stated that it would have been difficult to meet the demands of the deal but he remained optimistic. The contract, when it was first inked, had been worth US18.8M. Issues encountered during the first shipment last December resulted in the decision to amend the current contract. Price, delays in off-loading, conditions for shipping white rice and a number of other factors were discussed and decided before exports were resumed under the deal. It was after negotiations between the Guyana Rice Development Board (GRDB) and Venezuelan officials last month that the deal was revised to US$21.7 million. Stabroek News had learnt that the second shipment of rice should have arrived in Venezuela during the first week of April. The remaining paddy and rice is expected to be shipped within a three-month period (ending in June or early July).  The shipments leaving these shores will be subject to the availability of vessels, among other aspects agreed to between the two parties. April is almost over and it is only now the second shipment has been finalized. Before the contract’s revision was announced the ability to supply Venezuela had been questioned and the effects the El Nino condition were noted. Losses in the rice industry as a result of the dry weather, Persaud said Thursday, amount to approximately 8 thousand acres. The losses have not yet been given a “monetary value”, the minister explained, since it is still too early for some regions as all the losses have not yet been recorded. Despite this the production of the first crop this year exceeds the amount harvested during last year’s first crop, the agriculture minister pointed out, and farmers have been able to reap as much as 58 bags from an acre. A release from the Agriculture Ministry about the points raised at the press conference said that farmers were advised by GRDB Extension staff since the sowing season of 2009 “to be careful as the prediction that we will not have enough water to take the crop to the finality, this was mainly in the areas that mainly dependant on rainfall, e.g. Leguan, Wakenaam and the front lands of the Mahaica and Mahaicony.” The minister also said that $110M has been allotted to the recovery of the rice sector. About 900 small acreage rice farmers will receive seeds and fertilizers. Distribution will commence shortly and Persaud stressed that no cash will be distributed under this recovery plan. There was also a recent outbreak of paddy bugs as a result of the recent weather conditions. However, the GRDB Entomology and Extension staff is currently distributing Pronto (insecticide) to farmers whose crop is in the flowering to milk stage. This exercise will cost approximately $5M; this sum is not included in the $110M allotted for the sector’s recovery.

Bill Gates praises Indian rice that can withstand flooding

A new variety of rice that can withstand flood and developed by India has received praise from Microsoft founder Bill Gates, who said it is helping farmers to have higher productivity. Gates, a frequent visitor to India, had a firsthand experience of this variety of rice when he visited the country last year. "Last year, I got a chance to visit a site in India where they are using new varieties of rice that withstand flooding," he said during the launch of a $800-million international fund to fight global hunger and poverty. "Already, it is allowing those farmers to have much higher productivity. This project has exceeded production targets by five-fold due to the farmer demand and the strong government support," Gates said, while giving example as to how countries were using innovative tools and research to over come poverty. "We have already seen improvements in many regions, smart investments in cassava, sweet potatoes, legumes, rice and maize were helping farmers grow more in harsh conditions. Training and market access are also ensuring that farmers earn more for their hard work," Gates said. He said that his foundation's approach to agricultural development puts small holder farmers, most of whom were women. "That's the approach of countries like Rwanda and Ghana, their priorities in agriculture and seeing the impact and that's the approach of this fund and that's why we're so excited about that," he said. The fund was created in response to a call by G-20 leaders in Pittsburgh last year for the World Bank Group to work with interested donors to set up a multi-donor trust fund to help implement some of the USD22 billion in pledges made by G-8 leaders at their meeting in L'Aquila.

N.Korea Distributes Rice from Military Storage

Food prices in North Korea have stabilized because the regime took the emergency measure of distributing rice stored for the military, a high-ranking South Korean government official said Thursday. The Unification Ministry told the National Assembly on April 13 that the price of rice in North Korea was around 20 won per kilogram right after the botched currency reform late last year but soared to 1,000 won in mid-March. In early April, the price dropped to 500-600 won. At the time, experts predicted that the lean season in April and May coupled with the failed currency reform would cause increasing starvation. North Korea is over 1 million tons of food short this year. "It seems Kim Jong-il is starting to show some consideration for his people considering that the regime distributed rice buried deep in storage for the military," the senior official said Thursday. Prof. Cho Young-gi, a professor at Korea University, said the North Korean regime "wants to hold out as long as it can without having to rely on external aid." Although over 1 million people died of starvation between 1995 and 1998, the regime did not open up the emergency food and rice storage caves of the military. But times have changed, as recent unrest over the currency reform showed. "No North Korean would just sit and starve to death like in the 1990s," one defector said. According to a source, North Korea distributed some of the rice earmarked for military when the Kim Dae-jung and Roh Moo-hyun administrations in the South were generous with aid, and even then it stored newly arrived rice from South Korea and sold the old rice in the market. The reason why South Korea this year tried to replace rice aid with corn was that corn is more perishable and is therefore less likely to be appropriated by the military. The regime distributed 5 kg of rice, 2-3 kg of meat, and 1 liter of cooking oil in celebration of the birthday of nation founder Kim Il-sung on April 15. An inside source said North Koreans "are keeping up their morale."

Sarawak Faces Lack Of Interest In Rice Growing

KUCHING, April 24 (Bernama) -- Several factors have been identified as reasons why the younger generation in Sarawak are not interested in becoming paddy farmers, among them outdated labour-intensive methods, Bernas Chief Operations Officer Mohd Kamaluddin Mohd Effendie said. He said the state's geographical factor, with many rivers and scattered paddy fields, also made it difficult to utilise machines and deploy planting and harvesting technology like those in the peninsula. "Most farmers in Sarawak use traditional methods to plant padi which is why we want to try clustered paddy planting using modern technology," he told reporters here on Saturday. Mohd Kamaluddin said Sarawak was lagging when compared to Peninsular Malaysia in terms of paddy production and could only cater to 30 per cent of the demand while the remaining supply had to be imported from Vietnam and Thailand. He said Bernas welcomed the government's effort to turn Sarawak and Sabah as the country's new rice bowls and hoped that the move would result in an increase in production from 30 per cent to 60 per cent. He added that Bernas was ready to set up a Bernas Rice Mill complex in Sarawak should the state reach the required level of production.

Thursday, April 1, 2010

Finally, the Rice Revolution is Here

Rice is one of Nigeria’s most popular staple foods. Unfortunately however, the production of this popular food falls far short of demand, leading to large imports and the attendant food insecurity. But, as the Federal Ministry of Agriculture prepares to launch a major national strategy to combat the rice challenges, TAIWO OLAWALE writes that the revolution that would save rice production may have finally arrived here is no gainsaying the fact that rice has become a major staple in Nigeria. Over the years, it has taken over as the favourite food of many, beating other staples such as maize, yam and cassava to the number one position. In fact, it has become so popular that most Nigerian families eat it at least once every day. So, if anybody is talking about food security in Nigeria, rice must definitely take a front row position. And, it is not just in the area of food security that rice is important. It is also very important to the country’s economy in two major ways. In the first place, paddy rice farming is a major source of livelihood for farmers. Secondly, its production or lack of it has direct effects on the country’s importation bills. So, if there is adequate rice production, scarce foreign exchange is saved. On the other hand, scarce foreign exchange goes into rice importation when there is a shortfall in local production. Unfortunately, there is always a shortfall in local production. According to available statistics, the country’s estimated annual rice demand is put at five million metric tonnes. Placed against an estimated annual production average of about 2.21 million tonnes milled product, there is an annual deficit of 2.79 million tonnes (about 57 percent of demand), which is bridged by importation.More often than not, there is an increase in annual rice production, but consumption is also increasing annually. The National Bureau of Statistics estimates that yearly per capita consumption of rice, which stood at 15.8 kg from 1981 to1990 reached an estimated 27 kg in 2007. Unfortunately, during this period, self-reliance decreased from 87.4 percent to 71 percent in 2007. So, the continued rise in consumption dwarfs any marginal increase in production. With a scenario like this, one does not need to be an expert to know that the country would need to import millions of tonnes of rice to bridge the yawning gap between demand and supply. The importation of rice, a major staple is not just a big economic challenge; it is also a major challenge to the overall food security of the country. The problem becomes even more challenging when one realises that in this country of 150 million people, agriculture remains a key component of the Nigerian economy. One way or the other, agriculture provides employment for about 70 percent of the active population and currently contributes about 40 percent of the Nigerian GDP. But consistently over the years, the sector has continued to perform below its potential. With a land area of 923,768 square kilometers, the country has a total of over 79 million hectares of cultivable land out of which about 4.6 million hectares are suitable for rice production. Unfortunately however, only about 1.8 million hectares or 39 percent is currently utilised for rice cultivation in spite of the fact that rice is the fourth major cereal crop after sorghum, millet and maize in terms of output and cultivated land areas. This means that Nigeria has, over the years, failed to realise its natural potentials in the areas of local rice farming, production and marketing. But, how can the country tap into the seemingly limitless potentials available in the areas of rice farming and production? Can the country meet the rice per capita requirements of its citizens and even go on to turn the commodity into a major foreign exchange earner? A lot has been said and done by different governments at different levels with little or no change. This has led to a conclusion in many quarters that only a revolution can bring about the kind of changes that would lead to self-sufficiency in rice production. This is where a major gathering which is scheduled to hold in Minna, the Niger state capital next week becomes significant. According to a press release from the Federal Ministry of Agriculture and Water Resources, a major plan for tripling domestic rice production, improving indigenous processing capacity and enhancing the marketability of rice grown and processed in Nigeria will be launched in Minna on Monday. The initiative, the release explained, is the major thrust of the country’s National Rice Development Strategy (NRDS), which was developed in 2009. The NRDS is part of a global initiative known as the Coalition for Africa Rice Development (CARD). The CARD initiative was launched at the Tokyo International Conference on African Development (TICAD IV) in May 2008 with the sole aim of doubling rice production in sub-Saharan Africa within the next ten years. CARD was jointly developed by the Alliance for Green Revolution in Africa (AGRA) and the Japan International Cooperation Agency (JICA). According to the conference documents, the CARD initiative is expected to be implemented “in full respect of African ownership and leadership embodied in the Comprehensive Africa Agriculture Development Program (CAADP), and with strong links to existing structures, programmes, networks and initiatives such as Forum for Agricultural Research in Africa (FARA), and the African Rice Initiative (ARI).” Nigeria is one of the twelve pilot countries selected for the first phase of the CARD programme implementation. And, each of the 12 countries was required to develop a National Rice Development Strategy as the first step towards achieving the CARD objective of doubling rice production by 2020. The country has been working diligently on the strategy since then. Monday’s presentation is expected to be the beginning of a revolution that would triple rice production in the country by 2020. The NRDS, which will be presented to the public by Governor Babangida Aliyu of Niger State, outlines the plan for transforming the production, processing and packaging of rice, which is a food item of choice for most households in rural and urban Nigeria. The main thrust of the strategy is to increase rice production in Nigeria from 3.4 million tonnes to 12.85 million tonnes within a decade. This expected increase is nearly 300 percent. One of the immediate effects of the strategy, if faithfully executed, would be that the country would save more than $500 million expended on rice importation annually. It would also impact positively on food security, job creation, balance of trade, poverty reduction and national productivity. Engineer Moses Adewuyi, the Director of Agro-processing and Marketing in the Federal Ministry of Agriculture and Water Resources described the strategy most succinctly when he declared that, “Now we have a holistic strategy for harnessing the potentials of a multi-billion Naira sector for the benefit of our people and our country. This strategy focuses on all points of the rice value-chain and provides the missing link for the development of this vital sector.” According to the NRDS, Nigeria is the highest importer of rice in Africa, and the second highest in the world. The strategy document however notes that the country has a huge but untapped potential for rice production and processing. According to the NRDS, only 39% of the 4.6 million hectares of land suitable for rice production is under cultivation; less than 50, 000 hectares of the estimated 3.14 million hectares of irrigable land is used for rice; and, on the average, less than half of the total amount of rice paddies grown in the country is processed. To address these gaps and improve rice production and processing in Nigeria in a sustainable manner, the NRDS is prioritizing three areas of intervention. The first area is post-harvest handling and processing. There would also be massive intervention in the area of land and irrigation development and paddy production while the third area of intervention would be in seed development and other production inputs. In the area of post-harvest handling and processing, the strategy would be to support the establishment of modern rice processing mills “that will deliver high quality parboiled milled rice that can compete favourably in both domestic and export markets.” Under this strategy, there are also plans for surveys to generate data for effective planning; conduct training for scientists, extension workers and farmers on latest techniques and best practices; focus on development of standards and grades for quality assurance as well as the undertaking of advocacy and branding of domestic rice “to convince Nigerian consumers that the domestic rice industry can deliver commodity that is comparable to imported rice.” Under the second priority area, the strategy is to expand land under cultivation for rice through clearing of more land, increase of farm power through mechanisation, and the introduction of public-private partnerships for better management of under-utilised irrigation schemes in the 26 states which constitute the 11 river basin authorities in the country. For seed production and input development, the strategy will be to subsidise and increase access to quality inputs, provide support to research institutes to produce breeder, foundation and certified seeds, introduce hybrid and high-yield rice varieties, and make chemicals and fertilizers available and affordable to boost rice production. In addition to all these, the NRDS advocates for the creation of a better policy environment for rice sector development. The plan is expected to be funded by the Nigerian government and its development partners. Now, most people would wonder why the NRDS should work where other policies have failed. But quite a number of stakeholders have expressed confidence in the workability of the document, saying that it is indeed the beginning of the rice revolution Nigeria needs to realise its rice production potentials. First, they point to the painstaking processes that went into its production. According to a release signed by the Permanent Secretary, Federal Ministry of Agriculture, Alhaji Salisu Aliyu Gusau, the strategy was developed from a workshop organised last year by the National Food Reserve Agency (NFRA), “to harness the contributions of all stakeholders on how to transform the rice sub-sector. The workshop was sponsored by the Japan International Cooperation Agency (JICA), with representation from other development partners, including the World Bank, USAID, World Food Programme, AfDB, UNDP, and NEPAD.” Secondly, the country’s development partners have hailed the document as a pragmatic document that can solve the rice problems of the country in ten years. They are so impressed with its intervention programmes that they have recommended it as a model for other participating countries. So, as the document is launched in Niger State, which is the highest rice producing state in the country, a major revolution that would signal rice production sufficiency may be about to start. With this revolution, the country may move quickly from being the biggest importer of rice in Africa to the biggest exporter in ten years. With the NRDS, the rice revolution is finally here. And since rice is a major staple, the country may truly be on the way to achieving food security.