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Rice jumps to record on imports, curbs on
exports
Monitoring Report
RICE climbed to a record for a fourth day as the Philippines, the
biggest importer, announced plans to buy 1 million tons and some of
the world’s largest exporters cut sales to ensure they can feed
their own people. Rice, the staple food for half the world, gained
2.4 percent to $21.50 per 100 pounds in Chicago, double the price a
year ago. Philippine President Gloria Arroyo announced two rice
tenders today and pledged to crack down on hoarding. Anyone found
guilty of “stealing rice from the people” will be jailed, she said.
“We’re in for a tough time,” Roland Jansen, chief executive officer
of Pfaffikon, Switzerland-based Mother Earth Investments AG, said in
an interview with Bloomberg Television from Zurich today. Unless
prices decline “you will have huge problems of daily nutrition for
half the planet.” Mother Earth holds about 4 percent of its $100
million funds in the grain.
China, Egypt, Vietnam and India, accounting for more than a third of
global rice exports, curbed sales this year to protect domestic
stockpiles. The World Bank in Washington says 33 nations from Mexico
to Yemen may face “social unrest” after food and energy costs
increased for six consecutive years. The Philippines, which imports
about 15 percent of its rice, is tightening controls over domestic
sales and buying more overseas. The government’s rice tenders are in
April and May. “I am leading the charge” against any officials and
businessmen who divert supplies or distort the price of the staple
food, Arroyo said in a televised speech today.
“The need to avert social tensions from high food prices” has made
“food sufficiency even more urgent,” Abah Ofon, a soft-commodities
analyst with Standard Chartered Plc, said in a report yesterday.
Food importers may not be able to meet their needs because of the
export limits, Dubai-based Ofon said. The Philippines may raise
imports of milled rice by as much as 42 percent to 2.7 million tons
this year from 1.9 million tons in 2007 to discourage speculation by
local traders, Agriculture Secretary Arthur Yap said March 26.
The price of rice from Thailand, the world’s biggest supplier, may
climb another 25 percent this year, said exports including Vichai
Sriprasert, former president of the Thai Rice Exporters’
Association. Rice seeding in the U.S. is behind last year’s pace
because of flooding in growing regions, the Department of
Agriculture said yesterday. Farmers in six states have planted 11
percent of their crop versus 21 percent a year earlier. In Arkansas,
the biggest rice-producing state, about 2 percent of the crop was
seeded, compared with 21 percent. Commodity prices are posting their
seventh year of gains. The UBS Bloomberg Constant Maturity Commodity
Index of 26 raw materials more than tripled in the past six years as
global demand led by China outpaced supplies of metals and crops.
Rising food prices are fueling global inflation. Wholesale costs in
India rose 7 percent in the week ended March 22, the fastest pace in
more than three years. Soaring prices could lead to increased
unrest, such as in Haiti recently, the United Nations said in a
report yesterday. Four people died in two days of rioting last week
over food prices in Haiti, the western hemisphere’s poorest country,
the organization said on its Web site. “What we see in Haiti is what
we’re seeing in many of our operations around the world — rising
prices that mean less food for the hungry,” the report said, citing
the United Nations World Food Program’s executive director Josette
Sheeran. Burkina Faso, Cameroon, Egypt, Indonesia, Ivory Coast,
Mauritania, Mozambique and Senegal have also experienced unrest in
the last several weeks related to food and fuel prices, according to
the report.
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