Rice

Bad weather hampers NFA efforts to distribute more affordable rice across the country

Sri Lanka is forecasting 1.080 million tonnes of paddy (rough rice) to be produced in the ‘Yala’ minor cultivation season that falls in the second half of the year, which is up 18 percent from last year output of 909,000 metric tonnes. Up to the end of May 273,471 hectares of rice had been sown, up from the last year’s extent of only 249,000 hectares amid one of the worst droughts in history.

Monsoon rainfall has deteriorated in July, falling 16% below average this month after being patchy and erratic in the first four weeks of the season, which has delayed crop planting significantly and raised concerns about agricultural output. Total rainfall shortfall since June 1 has widened to 8% after being 5% lower than average at the end of June. As a result, planting of rice, the season’s main crop, is already 15% lower while the area under pulses is 19% lower than the acreage this time last year.

With the Korean government emphasizing less rice production, output in 2018-19 is forecast to fall by 6.1%, to 3.73 million tonnes. Consequently, estimated rice planting area has been revised down 6.6% to 705,000 hectares, about 50,000 hectares less than the previous year. The reduced paddy lands were converted to soybeans (8,891 hectares), forage (13,576 hectares), and other various crops (10,384 hectares).

The organisation has increased the estimate for global rice output in 2018-19 to record 511.4 mln tn, from 511.3 mln tn seen last month and 504.6 mln tn produced last year. Global utilisation of rice has been pegged at 509.5 mln tn, up from 509.3 mln tn projected earlier, and 504.3 mln tn last year. Following rise in the estimate for global rice consumption, the agency has lowered its projection for 2018-19 ending stocks to 173.7 mln tn from 173.8 mln tn projected earlier. Global trade in rice is seen at 47.5 mln tn, 0.1 mln tn higher than the earlier estimate, but lower from 47.8 mln tn last year.

After being a rice exporter, Egypt will turn into an importer following the governmental measures reducing the rice-cultivated areas due to the water shortage crisis the country is suffering from. Thus, it is expected that Egypt will produce about 3.3 million tons this year as one feddan produces 4 tons, while the Egyptians’ annual consumption of rice is estimated at 4.3 million tons.

In June alone, the country shipped abroad about 604,000 tonnes of rice worth US$317 million, raising the first half’s figures to 3.6 million tonnnes and US$1.8 billion, respectively. Vietnamese rice was sold at an average price of US$505 per tonne in the first five months of the year, up 13.4% year-on-year. China remained the country’s largest rice importer, making up 30% of the market share, with more than 844,000 tonnes valued at US$449.4 million. Vietnam is expected to garner 23.3 million tonnes of rice in the remaining months of 2018, raising total output in the year to 43.9 million tonnes, representing a year-on-year rise of at least 1.2 million tonnes. Notably, Vietnam’s rice exports to Indonesia rose 290.8 times in volume and 269.5 times in value against the same period last year to reach 596,058 tonnes and US$280.04 million, accounting for 17.3% of the country’s total export turnover to Indonesia.

Pakistan has exported rice worth around 2 billion U.S. dollars during the last fiscal year (FY), June 2017-July 2018. The country’s rice export hit the 2-billion-U.S.-dollar mark for the first time since the FY2014-15 as it achieved the target of 4 million tonnes of the crop yield this year. Average per-tonne export price of rice in the last fiscal year also rose to around 1,040 U.S. dollars, from below 950 U.S. dollars in fiscal year 2016-17. Rise in international prices of rice coupled with a higher demand of Pakistani rice and local rice exporters investment on processing and packaging of rice also contributed to the achievement.

The government hiked the minimum support price (MSP) or purchase price for paddy crops up to Rs. 200 per quintal as it looked to fulfill its poll promise to give farmers 50 per cent more rate than their cost of production. The announcement of higher MSP coupled with the forecast of normal monsoon this year, could further boost foodgrains output. The MSP of paddy (common grade) has been increased by Rs. 200 to Rs. 1,750 per quintal, while that of Grade A variety by Rs. 180 per quintal to Rs. 1,770.

Shares of rice mill operating stocks gained trade after the government increased minimum support price for paddy.

The government is reportedly set to announce an increase of ?200 per quintal in the minimum support price (MSP) for paddy. This is the single highest increase in the MSP for paddy in a given year in India, besting the ?155 hike by the Congress in 2008-09. It is about to announce an increase of ?200 per quintal in the minimum support price (MSP) for paddy, bringing the overall MSP to 1,750.