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FAO projects rice exports to go up 2%

DESPITE the restraint exercised by the Philippines and Indonesia, two of the biggest rice importers in the world, the Food and Agriculture Organization (FAO) projected that global rice export will go up by 2 percent on year to 37.3 million metric tons (MMT).

In its “Food Outlook,” FAO noted that both the Philippines and Indonesia have rolled out self-sufficiency policies and are restraining their reliance on world markets.

“[A] major development for the rice trade in 2012 is a sharp retrenchment from the world market by Bangladesh, and especially, by Indonesia and the Philippines,” the report read.

FAO foresees Indonesia to halve imports to 1.3 MMT this year while the Philippines’ purchases will drop by 22 percent on year to 900,000 tons.

Nigeria, which has been tagged by the Asian Development Bank (ADB) as the world’s biggest rice importer, will increase its purchases by 17 percent on year to a record 2.8 MMT.

“Although Nigeria is also engaged in ambitious rice-development programs, the announced heightening of import taxes in 2012 had the effect of prompting a rush of purchases,” the report read.

Aside from Nigeria, the FAO report noted expectations of a sharp increase in the rice imports of other countries in Near East and Africa such as Iran, Brazil, and Venezuela will contribute to the rise in global rice trade.

FAO said an “outstanding development” in the international rice trade is the emergence of India as the top rice supplier after decades of Thailand’s leadership.

“The displacement of Thailand from its leadership was mainly the result of the pledging program run by the Thai government to guarantee high prices to producers, which has severely hindered the country’s competitive edge,” the report noted.

For 2013, FAO anticipates that rice exports could also go up slightly to 37.5 million tons as ample supplies in exporting countries may intensify competition for world markets and foster a further easing of prices.

Global rice utilization in the 2012/2013 period is predicted to increase by 1.4 percent to 475 MMT due to an increase in population.

Being a major staple food, FAO noted that over 85 percent of the total, or 402 MMT, are estimated to be destined for human consumption, with only small amounts diverted to feed or industrial uses.