'Soft' rice prices to remain, says FAO

Rice prices for the first half of this year will remain "soft" due to larger harvests, plus a two-million ton increase in global stocks, as benign post-La Nina Weather boosted production.

The Philippines, in fact, anticipates bigger output from tapping an additional 200,000 hectares of irrigated farmland last year, says new issue of the Rice Trade Monitor.

The Food and Agriculture Organization publishes Monitor, as supplement to its regular Food Outlook report.

"Imports by the Philippines could fall by about 25 percent from the 1999 estimate, if expectations of an increase in domestic production materializes," the Monitor observes. "The country's carry-in stocks were also higher."

It's not clear yet how the late January and early floods affected harvest of the Philippines' 1999/2000 second season crop. Planting of the main season crop here starts in April.

Rice price movements, in the months ahead, will be influenced by reports of harvests in countries like Indonesia, Thailand, Vietnam and China.

Jakarta's harvest season extends to May. If the government's target of 51 million tons is achieved, this two percent increase would be the highest in four years. It would provide President Wahid some elbow room in reducing imports.

China's 198 million tons output will shrink fractionally. Beijing is reducing sowing of inferior quality grains. Adequate monsoons in Cambodia boosted harvests by nine percent. Myanmar has managed to hold the line at 17.5 million tons.

Thus, major exporters, like Thailand and Vietnam, "will likely ship less during 2000, not because of a lack of exportable supplies," the Monitor points out. Rather, this will stem "from a contraction of import demand."

Bangkok thinks the drop in import orders will be about 10 percent Hanoi anticipates a six percent cut.

"Global rice trade in 2000 is provisionally forecast to fall, by about eight percent, from the 1999 level, to approximately 23 million tons," the Monitor states.

"Most of the expected decline will be in Asia," the UN publication adds. "Asian countries are expected to import 14 percent less rice than last year" compared to a four percent expansion in Africa. -- (DEPTHnews)