Who is the back pusher?, Global rice prices have risen to new highs in nearly 12 years | Rice | Global

Since 2022, global rice prices have continued to rise. The Food and Agriculture Organization of the United Nations recently released data showing that the global rice price index rose 2.8% month on month to 129.7 points in July, setting the highest level since September 2011.

Who is the driving force behind the price increase of rice?

The driving force behind the price increase is the ban on Indian rice exports

The global rice prices rose in July, and the Food and Agriculture Organization of the United Nations believes that the main reason is the rice export ban announced by India in July, which further puts upward pressure on prices in addition to seasonal supply shortages and Asian procurement.

Due to extreme weather conditions such as high temperatures and heavy rainfall, India's rice production has been hit this year. To ensure domestic market supply, on July 20th, India announced a ban on the export of rice other than steamed rice and Indian fragrant rice.

"India's rice trade accounts for 40% of the world's total rice trade, and its export ban is like throwing a 'big bomb' in the rice market, causing panic in the world's rice market. In addition, unscrupulous merchants are taking advantage of this opportunity to profit, further pushing up rice prices." Jiang Wenlai, a researcher at the Institute of Agricultural Resources and Agricultural Regionalization of the Chinese Academy of Agricultural Sciences, pointed out in an interview with China News Agency's China Railway Express reporter that there are two reasons for the rise in rice prices this time:

One is the subsequent adverse effects brought about by the Ukrainian crisis. Russia has interrupted the Black Sea grain agreement, which has affected Ukraine's grain transportation chain, a major European granary. In addition, some grain merchants have fueled speculation, driving up world grain prices;

The second is the impact of El Ni ñ o phenomenon. Due to extreme weather causing localized drought and flooding, rice production has been affected to some extent, causing global concerns. Some countries are hoarding grain, further exacerbating the tension in the rice market and driving up rice prices.

Is the rice crisis coming soon?

The rising price of rice has raised concerns about food security. Is the rice crisis coming soon?

Sherry Mustafa, a rice market analyst and economist at the Food and Agriculture Organization of the United Nations, denied this view in a media interview: although global rice production decreased last season, the overall reserve of rice is still very sufficient, so we are not facing a shortage of rice supply.

So, how long will the current high price of rice continue?

Jiang Wenlai predicts that it will continue for some time. After Russia's demands are met to a certain extent in the world game, the Black Sea Food Agreement will also be restored under certain conditions, and rice prices will be alleviated. "However, based on the overall situation, it is still cautiously optimistic for rice prices to return appropriately in the future."

Will it affect the job prospects of Chinese people?

The world's rice prices have risen, and since entering the flood season, many parts of China have been affected by floods, which have also affected the rice production areas in Northeast China. Some people are concerned if this will affect our jobs.

Jiang Wenlai pointed out that in 2022, China imported a total of 6.19 million tons of rice, but mainly crushed rice, which is used as feed. The global rise in rice prices may have some impact on China's feed and grain consumption, but it will not fundamentally shake the foundation that "China's rice bowl is firmly in the hands of the Chinese people.".

In 2022, China's grain production reached 1373.06 billion catties, a year-on-year increase of 0.5%, reaching a new historical high. Grain production has remained above 1.3 trillion catties for 8 consecutive years, with a per capita grain share of 483 kilograms. Moreover, China has sufficient rice reserves and a self-sufficiency rate of over 100%. "Our country's food supply, especially rice, is absolutely safe," said Jiang Wenlai.

In addition, the latest data released by the State Administration of Grain and Material Reserves also shows that as of August 15th, various types of grain enterprises in the main production areas have cumulatively purchased 55.47 million tons of summer grain. The summer grain peak season procurement will continue until the end of September. Currently, the overall progress of wheat procurement has exceeded 80%, and the early indica rice procurement is nearing completion. The market is running smoothly, with active purchase and sales, and the number of purchases has increased year-on-year, laying a good foundation for ensuring the supply of the grain market.

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"Global food security is threatened"

Recently, Bo Daman, an official from the Department of Natural Resources at the Asia and Pacific Regional Office of the Food and Agriculture Organization of the United Nations, stated that global food security is at a "turning point". The shortage of rice and the soaring price of rice have dealt a heavy blow to the world's most vulnerable groups. According to the Associated Press on August 21, global food security has been threatened due to Russia's termination of the Black Sea Grain Initiative on July 17, coupled with the emergence of the El Ni ñ o phenomenon causing a reduction in rice production. Currently, global rice prices are constantly rising, and Vietnam's rice export prices have soared to a 15 year high, posing significant risks to vulnerable groups in some poor countries. However, in order to control domestic prices, India, the world's largest rice exporting country, announced in July that it will ban some rice exports, leaving a huge gap of about 10.4 million tons of rice needed globally, accounting for about one-fifth of the total global rice exports. In addition, the United Arab Emirates has also suspended rice exports to maintain domestic inventories. It is worth noting that before India implemented restrictions on rice exports, countries around the world had already been purchasing and hoarding large quantities of rice to prevent the potential supply shortages and price spikes caused by the El Ni ñ o phenomenon. Scientists have indicated that climate change is making the El Ni ñ o phenomenon stronger, and it is expected that the scale of the current El Ni ñ o phenomenon will expand, with its impact spreading globally. It is reported that Asian countries account for about 90% of the world's total rice cultivation, but currently, rice production in Asian countries is also struggling. Typhoon Dussuri hit rice producing areas in the northern Philippines, causing damage to $32 million worth of rice crops, which accounts for approximately 22% of the country's annual rice production. Indian food policy expert Devind Sharma said that it is precisely under the influence of such unstable weather that India has implemented measures to restrict rice exports. The unstable monsoon and El Ni ñ o phenomenon mean that India needs to issue partial bans to prevent local food prices from rising. As another major global exporter of rice, Vietnam's annual rice production is expected to be slightly higher than last year. With the export price of rice in the country reaching a new high in 15 years, Vietnam hopes to seize this opportunity to promote the export of local rice while maintaining domestic rice price stability. It is understood that the Philippines is currently in negotiations with Vietnam, attempting to import rice from the country at a lower price.