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.