WASHINGTON – Japan’s decision to sell 200,000 metric tons of stockpiled US rice to the Philippines and to donate 20,000 metric tons to five African nations has helped ease what previously seemed to be an unstoppable price surge on the global rice market, The Washington Post said.
Following a US appeal, Japan acted swiftly to sell or donate the excess rice to ease hunger, it said.
This will give both Japan and the United States moral standing at next week’s meeting of the UN Food and Agriculture Organization to urge countries such as Vietnam and India, which still limit exports of rice, to be more flexible, the daily said in an editorial on Tuesday.
But more needs to be done.
Looking further ahead, Japan needs to consider consuming more US and other foreign-grown rice itself, thus limiting what has become a major distortion in the global rice trade, the daily said.
“It’s time to push for free trade in rice throughout Asia, Japan included,” it added.
In a separate news report from Manila, the newspaper said Japan is selling off imported rice that its people do not eat and that its government imports only because it must, under international trade rules.
Although Japan grows far more rice than it needs, it has to import about 700,000 tons of the grain a year under the terms of a 1993 World Trade Organization agreement which obligated Tokyo to open its protected rice market to foreign competition.
The article said Japan’s stockpile of imported rice, mainly from the United States, peaked two years ago at 1.9 million tons when it began using about 25,000 tons a month to feed cows and pigs.
Japanese consumers, for the most part, do not like the taste of imported rice but even if they did, they cannot buy it domestically. Japanese-grown rice costs at least double the price of imported rice.
To protect Japanese rice growers the government keeps imported rice off the market and stores it in refrigerated warehouses, the daily said.
Stable until June
Here at home, Agriculture Secretary Arthur Yap said the price of rice has now stabilized and is expected to remain at current levels until the end of June.
Yap said that the country is close to ending the harvest of the summer crops, which he said should be around the end of June.
“For all intents and purposes, 90 percent of the harvests will be in by the end of May,” Yap said.
With the summer harvest, Yap said the National Food Authority (NFA) has more than enough rice to supply the demand before the lean months come in.
The ample supply has stabilized prices for the meantime, but Yap admitted there is no assurance this would remain the same for the rest of the year because the country is entering the lean months starting June.
“We have to wait for how the prices will behave,” he added.
Yap noted that the NFA would continue its importation of rice for its buffer stocks, that domestic production is stabilizing and the private sector is also importing its requirements.
The government’s latest tender for rice in the international market saw only one private trader participating, even though the imports would have gotten duty free privileges courtesy of the NFA.
Yap said the lack of participation by the private sector shows that “there’s a lot of supply in the market.”
However, he did not discount the possibility that the traders shied away because of the prevailing high prices in the world market.
He declined to speculate on how the prices would move after June since the price of the commodity is largely determined by global factors.
Yap said the current price of P35 to P40 per kilo is actually normal for the region and that the Prime Minister of Thailand who visited the country last week confirmed this.
Gains could be wiped out
Meanwhile, an Economics professor said all the government’s hard work in improving the country’s economy since last year could go to waste if the food crisis to persist until the end of the year.
Economics Professor Arsenio Balisacan, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA) director, yesterday said in a media discussion called The Forum that the 7.3 percent economic gain in year 2007 and the expected 5 to 6 percent increase at the end of this year would disappear because of the current food crisis.
“Based on experience, this should lead to the reduction of poverty. But because of the recent food crisis...by 2008 all the gains would be completely wiped out,” Balisacan said.
He also presented data showing that the population of poor Filipinos has already increased by two percent in a span of one year. In year 2006, it was 32.9 percent and last it year it was pegged at 34.7 percent.
Senator Edgardo Angara said the two percent increase could roughly be translated to five million Filipinos.
Angara, who previously served as Department of Agriculture (DA) secretary, said the prices of rice would unlikely go down in two to three years if the other factors such as the prices of transportation and fertilizers do not go down.
He said other problems such as adequate irrigation; supply of fertilizers and seed should also be addressed. The government should also tap the Department of Social Welfare and Development (DSWD) to identify the poorest towns in the country and subsidize the prices of rice being sold to them. –Evelyn Macairan. Marvin Sy