Tuesday, April 08, 2008

Fear of rice riots as surge in demand hits nations across the Far East

April 8, 2008
Leo Lewis, Asia Business Correspondent
Times Online (UK)

Any farmer in the Philippines caught hoarding rice risks spending the rest of his life in jail for the crime of “economic sabotage”.

Meanwhile, on the streets of Jakarta, Indonesia, thousands of makers of traditional tempeh soyabean cakes strike in protest as their livelihoods are destroyed and their countrymen starve. In Malaysia, where immense palm oil plantations stretch as far as the eye can see, panic buying of palm oil has stripped stores bare.

Chinese, Korean and Japanese companies are preparing to compete in a desperate “land grab” for agricultural land across the globe. Japan already owns three times more farmland overseas than in its home territory; Seoul is keen to do the same.

For Asia's 2.5 billion people who depend on rice, these are anything but isolated incidents. They are what happens when huge sections of society move into the cities, when farm productivity growth halves over two decades and when bad weather or disease exposes fragile dependencies on the exports of a few nations.

They are also the result of the harsh economics of industrial growth. The dramatic improvement in lifestyles and family finances of millions of Chinese and Indians has driven a demand for meat, milk and cooking oils that did not exist a decade ago.

The more than doubling of China's average meat consumption since 1985, for example, has created an equivalent leap in demand for animal feed.

The US Department of Agriculture believes that the world will suffer a 29 million tonne discrepancy this year between what it needs to feed itself and what it can actually produce. Markets have been quick to recognise this and the traditional Asian staples of soyabeans, palm oil and pork have all soared.

Many grain and edible oil markets have also been squeezed by what some observers believe is an unsustainable conflict between cars and stomachs. Land that might previously have been used to feed people is increasingly planted with crops designed for conversion to biofuels, forcing unexpected rises in the prices of everything from tofu to instant noodles.

But perhaps more unsettling has been the suddenness with which Asia's exposure to a food crisis has emerged. Countries that, until a few weeks ago, could rely on substantial imports of rice from India, Egypt or China are scrambling to cope with a new reality in which they cannot do so.

Nations such as Japan and South Korea that were running food economies with small self-sufficiency ratios have taken only a few weeks to react bitterly to the new situation as the world's food stocks-to-consumption ratio plunges to an all-time low.

India - which traditionally has exported millions of tonnes of rice - has decided to set aside a special strategic food reserve on top of its existing wheat and rice stockpiles. Vietnam, the world's third-largest rice producer, has been forced to curb exports and Cambodia has banned them completely.

In Thailand, the world's largest producer of rice, rising concerns of a shortage have sent rice prices more than 50 per cent higher over the past month. When Samak Sundaravej, the Thai Prime Minister, appeared on his weekly television cooking show over the weekend he told Thais there would be “enough rice for the Kingdom”.

It was not a message designed to calm nerves elsewhere in Asia where Thai rice exports are an essential part of the diet.

Amid these highly visible signs of government-level panic, Asian countries that have rarely faced severe conflicts of “resource diplomacy” are accordingly readying themselves for showdowns.

Analysts give warning of governments across the region resorting to a “starve-your-neighbour” policy in an effort to becalm rioting domestic populations, and the UN International Fund for Agriculture has previously said that food riots will become commonplace.

In the Philippines and Sri Lanka, both nations that are heavily dependent on rice imports, politicians and business leaders are racing to strike deals with the likes of Vietnam and even Burma in their bid to secure rice supplies.

Troops and special police are expected to be used in the process of distributing rice to regions where supply was never an issue.

Feeding the world
  • 33% Rise since January in price paid by Philippines for rice from Vietnam
  • 3 billion People worldwide who rely on rice as a staple food
  • 40% Rise in rice price in Thailand this year
  • 19.2% Rise in consumer prices in Vietnam last month, against March 2007
  • 8.4% Rise in food prices in the Philippines last month, compared with March 2007
  • 854 million Number of people worldwide who are “food insecure”
  • 1 billion People globally who survive on less than $1 a day, defined as “absolute poverty”


Anonymous said...

There is no doubt that dirt poor Cambodian people especially dirt poor Cambodian women will sell their body just to put food on the table for their family!

Anonymous said...

There is no doubt that dirt poor Cambodian people especially dirt poor Cambodian women will sell their body just to put food on the table for their family!

5:14 AM

Be kind and be gentle with your lanugage and have respect for them [women]. Even if they [women] might end up that way to feed their family you shall not say "Dirt poor women" - not all of them acting that way.

Anonymous said...

To 6:10AM

Hey! Cambodian women are more resourceful than Cambodian men even AH HUN SEN himself and sometime I wish that all Khmer men would die out!

The fact that Cambodian society is a male dominates society and Cambodian women are no less than a property belongs to a man!

Why are you so cybernetic about everything that I have to say?

Anonymous said...

CPP Youth Leadership rules!