Tuesday, September 18, 2012

Indonesia, Vietnam extend MoU on rice until 2017

rice-JAKARTA: Indonesia and Vietnam have extended a pact on rice supplies until the end of 2017, a trade ministry statement said on Tuesday, as Jakarta seeks to increase stockpiles of the staple grain to hedge against food inflation.

Last week, Indonesia's state procurement agency Bulog said it had a memorandum of understanding (MoU) with Vietnam for 1.5 million tonnes which was due to expire in January.

The MoU was extended from Jan. 1, 2013 until Dec. 31, 2017, Indonesia's trade ministry said in a statement following talks with Vietnam.

"With the signing of the memorandum of understanding, we hope it can support the national food security programme," Indonesia's Trade Minister Gita Wirjawan said.

"A similar MoU has been signed with several rice producer countries in ASEAN, such as Cambodia and Thailand, which aims to provide alternative rice buffers for Indonesia when needed."

Indonesia last year imported 1.9 million tonnes of rice from Thailand, Vietnam and India to ensure it had plentiful stocks of rice to avoid food inflation.

Indonesia's main rice harvest is usually in June or August, with a second crop towards the end of the first quarter.

It expects unmilled rice output to be about 68 million tonnes this year, and has ambitious plans to maintain stocks of 10 million tonnes by 2014.

Indonesia was self-sufficient in rice in the early 1980s, but the crop gradually declined as farmland was turned into housing for a booming population. Monthly rice consumption stands at about 2.7 million tonnes.

Rice, sugarcane crops to get benefit of devastated rains

ISLAMABAD - Though National Disaster Management Authority (NDMA) is not performing its duty as it was supposed to but in most of inundated areas, the farmers will get benefit of devastated rain spell in the country.

As per exclusive details taken from the farmers’ representative in different areas, rains have not damaged the crops a lot rather most of the crops have benefited from these rains.

It was learnt that NDMA was supposed to build temporary water stoppage walls at different locations, de-silting in some main channels but these works have not been done by the authority that ultimately caused the masses suffer.

As far as the rains effect is concerned in terms of crops that was observed overall positive throughout the country with partial loss to crops in some areas. The experts and farmers expressed that rice and sugarcane hopefully would get benefit of these rains. Especially they said that due to rains a disease named Pirella was controlled naturally that required pesticide spray.

Experts also said that impression of loss of crops in the country must not be given as that allows the black marketers to exploit and mint money by stocking product and creating artificial shortage in the market.

It was also learnt that cotton crop was also not under threat and rains controlled a lethal disease of cotton that was expected to damage the crop on large scale. The disease called “white fly” had attacked the cotton crop on early stage and rains have eliminated that pest that will ultimately increase the production.

It is worth mentioning here that country could not achieve cotton cultivation area target of 8 million acres, however rains could not hold responsible for it.

On the other hand, experts are of the view that if the rains continue in the next days that can prove disastrous for the crops

It is worth mentioning here that the long-term solution to the floods is constructing big and small dams in the different areas of the country and during that process it is needed to carry on maintenance work to reduce the losses occurred due to flood as much as possible.

The major loss that has been reported suffered by the masses and the country overall is structural loss, human lives and livestock.

Will Vietnam benefit from joining ASEAN Rice Exporters Alliance?

Thailand has proposed establishing an ASEAN Rice Exporters Alliance that consists of Vietnam, Thailand, Laos, Cambodia and Myanmar with the aim of increasing rice export prices.

 However, the proposal is facing some opposition from rice-importing countries and even in Vietnam, there are differing opinions on whether the country will benefit from joining the Alliance.

The aim of the Alliance taking shape at the end of this year is to help sharpen the competitive edge of ASEAN rice, promote information sharing and cooperation in production and marketing, and stabilize rice prices in the five countries.
The five previously mentioned ASEAN nations annually export a total of 20 million tonnes of rice, accounting for two thirds of global rice exports.

The International Grain Council (IGC) says that despite controlling nearly half of the global rice export volume, Vietnam and Thailand’s total share of the rice market will shrink to 38 percent later this year when India surpasses them to become the world's biggest rice exporter.

Establishing the ASEAN Rice Exporters Alliance is a response to the sharp increase in India’s rice market share after the country lifted its ban on exporting regular rice in  September last year.

As the world’s biggest rice exporter, Thailand has been carrying out a costly meal replacement programme after the government decided to buy rice from farmers at a price higher than it is on the market.

Currently, Thailand has up to 16 million tonnes of rice in stock but it is still reluctant to trade for fear of inflated prices.

Vietnamese rice has gone down in price since early this year in the face of tough competition from cheap Indian rice.

The Deputy Head of the Vietnam Agriculture Institute, Professor Dr Bui Chi Buu, says that as the second most populous country in the world, India stores a large volume of rice.

To maintain its temporary stockpiles, India has to sell the old rice in stock to make room for the newly harvested rice.

By far this year, India has traded just 30 million tonnes out of its more than 40 million tonnes of rice in stock.
The global rice market has experienced wild fluctuations following India’s decision to sell 20 million tonnes of stockpiled rice at low prices.

Vietnam has no such stockpiles of rice for export since its rice is not highly graded in the world. Most of its customers are mainly low-income nations, which puts the country at a disadvantage to compete with cheaper rice from India. 

In addition, experts say Myanmar will present the biggest challenge for Vietnam in the near future as it annually produces 13-14 million tonnes of rice and its government is trying to gain a leg up on the regional export market. 

Some claim the Myanmar Rice and Paddy Traders Association (MRPTA) are working on export management programmes to help drive up rice prices despite the fact it is only capable of producing rice of the same quality compared to Vietnamese rice.

So, in order to boost Vietnam’s rice exports and help farmers make a profit, Vietnam needs to join the ASEAN Rice Exporters’ Alliance to avoid unfair competition through reciprocal market concessions.

The Vietnamese Government knows too well that only by helping farmers earn higher incomes and stabilize their lives can it achieve the goal of rice production and export in a sustainable manner.

GM rice is more than food for thought

The Ministry of Health's investigation into a controversial US-backed genetically modified rice research project in Hunan province raises a wider set of questions than just the use of GM seeds to increase crop yields, because the researchers are alleged to have fed students GM rice as part of an experiment without their or their parents' knowledge.

The research was backed by the US National Institute of Health and the US Department of Agriculture, according to an article published in the August edition of the Journal of Clinical Nutrition.

The answers to all the questions that the Ministry of Health-ordered investigation raises are not yet known. GM seed makers say there is no proof that their seeds will harm human health, but a host of geneticists and ecologists across the world say there is no proof that GM seeds will not harm humans.

The battle lines for and against GM seeds were first drawn in Europe in the late 1990s. Activists in Europe claimed that GM seeds were unsafe for human consumption and damaged or destroyed other seeds and crops. Soon the opposition to GM seeds spread to other regions, and justifiably so if we look at what happened later to farmers in countries like India who planted GM seeds.

For all the claims of GM seed makers, especially Monsanto, cotton crops have been failing with eerie regularity in India. A country that first cultivated cotton more than 7,000 years ago (in what is now western Pakistan) and spread the skill of making cotton yarn to the Mediterranean and hence the rest of the world has seen more than 200,000 farmers commit suicide in the past decade. The farmers committed suicide because they were neck deep in loans, which they were forced to borrow to overcome successive Bt cotton crop failures.
The vicious circle the farmers were caught in - of using more expensive Bt cotton seeds and larger amounts of fertilizers and insecticides to increase their yields - was too much for them to sustain.

Thousands of kilometers away, Mexico, which gave corn to the world, has to import the bulk of its corn supply from the US today despite using GM seeds. If that was not enough of an irony, scientists in the US now say that corn rootworms might have developed resistance to GM corn, and the US Environmental Protection Agency says it plans to investigate.

Until the first half of the last century, seeds were overwhelmingly the property of farmers and public-sector plant breeders. But in the decades that followed GM seed makers have used intellectual property laws to commercialize seed supply throughout the world and are aggressive in their designs and sales strategies to maximize their profits. The top five GM seed makers - Monsanto (US), DuPont (US), Syngenta (Switzerland), Groupe Limagrain (France) and Land O' Lakes (US) - control 57 percent of the global seed market. Since the mid-1990s, Monsanto, Syngenta, and DuPont along with Bayer and Dow have bought up more than 200 other companies to become dominant players in the seed market. Can there be a better example of oligopoly?

GM seed makers jump in with "help" when crops fail in a country because of natural or human factors. They offer GM seeds as the panacea for all agricultural ills, only to milk farmers of their last penny, for once a farmer plants GM crops there is no going back to using normal seeds simply because natural seeds cannot yield anywhere near a healthy harvest on a piece of land where GM seeds have been planted.

The world may keep debating the pros and cons of GM seeds. But the farmers who have paid with their lives for using GM seeds have their own tale to tell.

Hopefully, the Ministry of Health has taken these factors into consideration while ordering the investigation into the controversial GM rice research in Hunan.