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13th february,2014 daily global rice e newsletter by riceplus magazine
1. 13th February , 2014
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TOP Contents - Tailored for YOU
Latest News Headlines…
Golden Rice - a complex tangle of unanswered questions
Banks look to higher loan demand for rice-industry working capital
India defies Brazil attack to pass sugar subsidy
TCEQ Defers Decision on Colorado River Rice Farmer
Rice production falls in challenging season
Thai Rice Subsidy to Expire
Thai Constitutional Court Hands PM Yingluck a Surprise Lifeline
Commerce Min inspects rice warehouse in Suphan Buri
Commerce Min to release 460,000 tons of rice
Rice Exports From India Climbing to Record on Mideast Demand
Rice seen ruling at current levels next few days
Rice basmati eases on sluggish demand, adequate supply
The spectre of rice politics resurfaces
Thai army chief says all sides in impasse must "tread carefully"
Thailand rushes to sell rice stockpile to appease farmers
Rice stock offer on AFET draws intense interest
First 50 rice farmers file court cases against government
Overwhelming response to rice sale
Price fall hits agri exports
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3. NEWS DETAILS:
Golden Rice - a complex tangle of unanswered questions
Clare Westwood:13th February 2014
Advocates of Golden Rice - a GMO rice that produces Vitamin A - present the debate over its use a clear
moral choice with only one possible conclusion. But as Clare Westwood writes, the reality is very
different ...
After many years of research and over $100 million spent, proponents of GR have railed to prove that it
really will cure VAD.
'Golden Rice' (GR) is rice genetically modified (GM) to produce beta carotene, the precursor of Vitamin A.Its
advocates claim that it provides the solution to Vitamin A deficiency, which affects some 190 million people
worldwide with effects that can include blindness.It has been the subject of fierce argument about whether it
really is a viable solution to Vitamin A deficiency (VAD) - or a 'Trojan horse' public relations tool used by
industry to gain regulatory and market acceptance of GE crops.
A $100 million drop
Called 'Golden Rice' because of its orange-yellow color, the first version of Golden Rice - GR1 - was developed
by Dr. Ingo Potrykus of the Swiss Federal Institute of Technology in Zurich, and Dr. Peter Beyer from the
University of Freiburg, Germany, from 1991 to 2000with an expenditure of about $100 million.This was funded
by four donors including the Rockefeller Foundation, one of the founding donors of the International Rice
Research Institute (IRRI) that is housing the Golden Rice Project and managing the Golden Rice Network for
the continued development of GR.The level of carotenoids (including beta-carotene) in GR1 was minimal at 1.6
micrograms per gram, and critique of this led to the subsequent creation of GR2 with a maximum of 31
micrograms per gram of beta-carotene.
The intellectual property rights tangle
One of the world's top pesticide and seed companies, Syngenta, acquired exclusive rights to the GR1
technology from its inventors but went on to develop GR2 itself. On World Food Day in 2004, it announced the
donation of GR2 to the Golden Rice Humanitarian Board.The Golden Rice Humanitarian Board, chaired by Dr.
Potrykus, is a public-private partnership responsible for the global development, introduction and promotion of
GE GR in target countries. It provides governance to the Golden Rice Project.In 2000, the Rockefeller
Foundation commissioned an intellectual property rights auditthrough the International Service for the
Acquisition of Agri-biotech Applications for IRRI.
70 separate patents and other IPRs
The audit found that there were 70 IPRs and technical property rights (TPRs) belonging to 32 different
companies and universities, which had to be navigated before the inventors could donate the technology as a
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4. 'gift' to resource-poor farmers through international agricultural research centres to national p technologies
needed to engineer the trait into rice belonging to Syngenta, Bayer AG, Monsanto Co, Orynova BV, and Zeneca
Mogen BV.Syngenta Seeds AG negotiated access to all these technologies and provided the GR Humanitarian
Board with the right to sub-license the GR technology to breeding institutions in developing countries, free of
charge. It is not known if a similar audit has been carried out for GR2.It has also provided a "humanitarian
use" licence that ensures that the use of GR seeds is free of royalty or similar charges to small farmers.Syngenta
reserves its rights to commercial exclusivity over GR1 and GR2, including commercial rights over
improvements to the technology - but the "humanitarian use" of such improvements is guaranteed.Syngenta
announced several years ago that it will not commercialize GR, however there is no legal obstacle should it
choose to do so.
GR - used to campaign for lower GMO risk assessment standards
A necessary condition attached to the agreement with GR licensees is that no field releases may take place in
the absence of a national biosafety regulatory framework. The decision to adopt the technology is a country's
prerogative.To fast track market approval, however, the proponents of GR are campaigning for lower risk
assessment standards for GE crops, including not only GR but all GM crop varieties.Data from ongoing field
trials in the Philippines and in Bangladesh will, in all likelihood, be used to support bio-safety clearances for the
commercialization of GR in these countries soon.It will be interesting to see what Syngenta does with its
exclusive commercial rights then. Will larger Asian farmers, not covered by the "humantarian use" licence be
subject to the same legal harassment that US farmers are facing from Monsanto for so-called infringements of
the latter's IPRs over their GM seeds to the tune of millions of dollars?
What exactly is 'humanitarian use'?
In the sub-licensing agreement, "humanitarian use" has been defined as (including research leading to) use in
developing countries (low-income, food-deficit countries as defined by the UN FAO) by resource-poor farmers
(earning less than US$ 10,000 per year from farming).
Other terms include the following:
the technology must be introduced into public germplasm only;
no surcharge may be charged for the technology - the seed may cost only as much as a seed without the trait;
national sales are allowed by low-income farmers - so urban needs are also covered;
reusing the harvested grain as seed for the following season is allowed;
no export of GR is allowed, except for research purposes to other licensees.
These terms appear to be straightforward, but they give rise to a multitude of concerns, especially over hidden
costs that are likely to emerge in practice like the costs of seed distribution and contamination if it occurs.
Difficult questions
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5. What, for example, of the stipulation that "no export is allowed"? In the event that Golden Rice is exported for
non-research purposes, this would be outwith the terms (and protection) of the humanitarian licence.Would this
constitute grounds for Syngenta to exercise its commercial rights by demanding royalties - or even preventing
such exports from taking place at all?So Syngenta could demand a royalty on any international shipments of
GR, or indeed prevent such exports from taking place at all.Which raises a further question - what if the GR
genes get to widely contaminate the rice seed across an entire country? Then effectively all the rice produced
would contain some degree of GR contamination.Could Syngenta then levy royalties on an entire country's
commercial rice production and rice exports?
Is it effective? And why all the butter?
The bioavailability of GR's Vitamin A was examined in a study published in June 2009. It found that in healthy
adults GR was indeed an effective source of Vitamin A.However the experiment did not include children or
malnourished individuals - those who are mainly intended to benefit from the Golden Rice.Also the meals
containing the GR were all high in fat. A 'breakfast' meal contained 10g of butter, providing 23% of the dietary
energy. A 'lunch' meal contained 15g of corn oil, 60g of meat and 20g of cashew nuts - and the fat provided
40% of dietary energy.This relatively high fat (and meat) diet is atypical of meals in rice-eating countries, and
especially those consumed in poor households where fat of any kind is a luxury.Beta-carotene is highly fat
soluble, and it is known that eating carotene-rich foods in conjunction with fat enhances its dietary availability.
So one has to ask - why was so much butter and oil included, if not to produce the desired result?And why were
trials not done of Golden Rice eaten in a low fat diet? Or on children and malnourished people - those that
Golden Rice is meant to benefit?
Findings questioned
As Michael Krawinkel asked in a follow-up letter to the American Journal for Clinical Nutrition, a key question
is " ... why the authors did not use a dietary approach more similar to the diets of the individuals who were
suggested to benefit from the consumption of this β-carotene-containing rice."One of the arguments used for
advertising Golden Rice is that the people at risk of vitamin A deficiency have such poor diets that other
sources of β-carotene and vitamin A are not accessible to them."Because diet definitely has an effect on the
bioavailability of β-carotene from any β-carotene-containing food, the choice for a study diet that included
meat, oil, and nuts, which does not represent a poor diet, is of concern."Therefore, the results of the study do
not much help us in preventing vitamin A deficiency in populations at risk."So - after many years of research
and many millions of dollars spent, proponents of GR have railed to prove that it really will cure VAD.
Threats to health? A dearth of evidence
There is also a possibility that GR poses a threat to people's right to health and safe food. Such fears are only
boosted by the fact that not a single feeding study on the health impacts of GR has been published to date.As
Krawinkel states in his letter to the AJCN, "More research in the prevention of vitamin A deficiency is required,
and animal studies in piglets may be an appropriate model to investigate the different approaches of
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6. supplementation, fortification, natural β-carotene from the diet, and nutrient-oriented plant breeding before
humans are further exposed to studies that obviously do not address potential health risks."
At whose risk?
Then there is the risk of genetic contamination of native and local farmer-bred rice varieties by this GM
rice.The GM Liberty Link Rice (LLRICE601) contamination scandal of 2006 demonstrated the ease with which
such contamination can occur and how it resulted in harm to farmers' livelihoods when many countries stopped
the import of long-grained rice from the US.In fact, in February 2013, in the face of expectations riding high
that GR would be soon approved for commercialization, IRRI itself had to admit that essential data for a proper
risk assessment were still unavailable.So, who will bear accountability should anything go wrong? The legal
situation is that no warranties are being given by the licensor(s) of GR, Syngenta and the Golden Rice
Board.Each party - that is, each country that accepts Golden Rice - is to be responsible for whatever liabilities
and costs may ensue from the introduction of Golden Rice. This amounts to a 'use at your own risk' scenario an apparently high price for a 'free gift'.
The root cause of VAD is poverty
Instead of looking at unnecessary, expensive, potentially risky, high-tech solutions like GR - without any
assurance of accountability by its creators - attention and funds would be better spent in alleviating the root
causes of VAD.Chief among these is poverty, but there are also issues of poor access to fresh greens and other
vegetables, especially in cities. Efforts to promote Vitamin A rich foods - like raw 'red' palm oil, Vitamin A
enhanced (by traditional breeding) varieties of maize and cassava, and mother's milk for babies - are at an early
stage in most countries.Policies aimed at preserving and expanding small-farm biodiverse agro-ecological
systems will sustainably provide locally available sources of food for a healthy and balanced diet, including
Vitamin A, especially for rural communities.So why is industry pushing GR so hard when there are far more
viable, sustainable, low cost and safe ways to address VAD? There is nothing 'humanitarian' about Golden Rice.
Its entire purpose is to serve as a Trojan Horse for the GM industry - and that is how it is being used.
Clare Westwood is a researcher on GM and other food and agriculture issues with Third World Network.
Banks look to higher loan demand for rice-industry working capital
Sucheera Pinijparakarn
The Nation February 14, 2014 1:00 am
Banks expect to enjoy rising demand for working-capital loans from rice millers and packers bidding for rice
released by the Commerce Ministry via public auction and the Agricultural Futures Exchange of Thailand
(Afet).The ministry yesterday put about 220,000 tonnes of rice on the Afet for sale and on Wednesday the
Public Warehouse Organisation opened bidding for 467,623 tonnes as part of a 1.2-million-tonne rice-sale
plan.About 18 bidders joined the auction, according to the ministry's report.Prasit Wasupath, a senior executive
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7. vice president of Krungthai Bank, said KTB had a short-term loan for existing rice traders that joined the
bidding. The bank has issued its internal practice manual to branch managers as a guideline in considering loans
to customers.KTB had been criticised on social media for lending to the government to subsidise the ricepledging scheme, prompting president Vorapak Tanyawong to hold a press conference to defend the bank. He
insisted that it did not give the loans and it upholds the principles of good governance and transparency and
would not allow anyone to use it as a political tool.
Prasit said the bank also tightened the criteria for rice bidders by requiring millers or packers to be existing
customers with credit lines of no more than Bt200 million each from the bank. The customers must have been
registered with the Commerce Ministry since 1946 and their businesses must show profits for two straight
years.KTB will lend no more than 70 per cent of the winning bids and customers will repay the debt with the
bank within nine months.Customers are required to outline the objective of their bidding plans before applying
for a loan.KTB has 300 rice millers in its customer base.
This short-term loan programme was not designed for the troubled rice-pledging scheme. It is a regular
programme to provide liquidity to rice-trading customers that might require working capital if they win
bids.Sammit Sakulwira, first senior vice president of Kasikornbank, said the rice bidding through the traditional
and futures markets will spur demand for working capital loans from the rice-trader segment.Existing customers
with credit lines from the bank can ask for a short-term loan to pay the ministry if they are bid winners.KBank
did not set loan qualifications as strict as KTB's.Credit lines range from Bt10 million to Bt100 million
depending on the repayment ability of each customer but the borrowers are required to repay debt within three
months, Sammit said.
India defies Brazil attack to pass sugar subsidy
Indian ministers, at the fourth attempt, passed a subsidy for sugar exports, defying condemnation from Brazilian
cane mills, which joined a growing list of critics of New Delhi's agricultural support programmes.India's
Cabinet Committee on Economic Affairs on Wednesday agreed a raw sugar export incentive of 3,333 rupees
($54) per tonne, a compromise deal between the agriculture ministry, which had held out for a slightly higher
sum, and a food ministry proposal attempting to stem the risk of stoking food inflation.
The subsidy is aimed at finding a market for the country's large sugar stocks, which entered the 2013-14
crushing season at a hefty 8.8m tonnes.The sugar industry is of large economic significance for India, the
second-ranked producer of the sweetener and the top consumer, with cane growing a key earner for rural
communities in many states.However, the committee's decisions defied an attack from Unica, the Brazilian cane
industry group, which became the latest body to raise concerns over India's generous agricultural spending,
which has boosted the country's food security and raised it into a large exporter of many crops.
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8. 'Punishing rivals'
Unica said it "condemns" the export subsidy, which would add to the cash India already spends subsidising
freight and transport costs.Both types of subsidy "not only distort international markets, but also artificially
force down prices, punishing exporters that don't resort to similar practices," the group said.India's move, while
a fillip to domestic producers by "propping up internal prices above global levels", represented a headwind to
foreign rivals, which are forced "to reduce their own output and adjust exports in future harvests, or face even
deeper losses because of depressed prices", Unica president Elizabeth Farina said.Unica said that its thinking
was in line with World Trade Organization policy, although some other observers believe that India is staying
within the rules by subsidising a half-processed product, raw sugar, rather than fully refined white sugar.
Grain concerns
However, governments of Canada, the US and Pakistan have already raised questions to the WTO over India's
support programmes for rice, of which the country is the top exporter, and wheat.Pakistan questioned the extent
of subsidies for non-basmati rice, which accounts for most of India's rice exports.Canadian officials queried
India's cut to $260 a tonne, from $300 a tonne, in the floor price for wheat exports, when this was "lower than
the price of the same quality wheat from Canada, and other countries, sold in the range of $270-275 per
tonne".And the US claimed that India was selling wheat for below market cost, once administration and storage
costs were added to the $220-a-tonne purchase price from growers.Indian officials are working on costings to
submit to a future WTO meeting.
TCEQ Defers Decision on Colorado River Rice Farmer
by Neena Satija
Feb. 12, 2014
Enlargephoto by: Spencer Selvidge
The Colorado River is shown east of Longhorn Dam in
Austin. The capital city is almost entirely reliant on the
Colorado River and its system of dammed reservoirs for
water,Following hours of heated public testimony, the Texas
Commission on Environmental Quality on Wednesday
determined it couldn't yet make a decision on instituting
a temporary emergency plan that would likely cut off the
flow of water to rice farmers in the Lower Colorado River
Basin for the third straight year. The growing season begins
in March.
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9. The commissioners' inability to make a decision — despite agency staffers' recommendation that they approve
the plan — is a strong indicator of how bad the battle has become between water users along the Colorado
River, which is managed by the Lower Colorado River Authority. The commissioners instead referred the issue
to an administrative law judge, who will hear arguments on the case and must issue a recommendation by Feb.
21.―I think it‘s going to be more useful and effective if we go through this additional step to make sure that due
process is indeed protected," said TCEQ chairman Bryan Shaw. Upstream users of the Colorado River's
dammed Highland Lakes — like the city of Austin and other Central Texas communities — support the
proposed plan.
But downstream users, including Gulf Coast-area rice farmers and fishermen, vehemently oppose it. So do
environmentalists concerned about the health of the Colorado River and the Gulf Coast estuary, Matagorda Bay,
that depends on freshwater inflows from the river. The Highland Lakes are 38 percent full today. Under the
proposed emergency plan, the LCRA would withhold water releases downstream to rice farmers and Matagorda
Bay until the lakes rise to more than 50 percent of their capacity. Even then, water could be curtailed. Multiple
severe rainstorms would have to occur between now and next month, when the rice growing season begins, for
the lakes' capacity to increase that much. Even if the emergency plan doesn't pass, most rice farmers aren't
likely to receive water deliveries anyway; under standing LCRA rules, the farmers' supply is cut off if lakes are
less than 42 percent full. Downstream users are so opposed to the emergency plan because it raises that trigger
to nearly 55 percent.
They argue the state and the river authority would be sending a message that agriculture is no longer a priority
in Texas. ―I cannot understand why it would be more important to back a jetski into the water or restore the
view of a lakeside home than it is to grow food for more than 800,000 people in a year," said Timothy Gertson,
a fifth-generation rice farmer in Wharton County.But Central Texas water users counter that they are feeling the
pain just as much as rice farmers. Businesses and residents along the Highland Lakes said they have lost
millions of dollars in revenue because boat ramps, marinas and lakeside restaurants have been closed due to low
lake levels. "The Texas way of doing business is to look out for its residents," said Chris Fielder, the mayor of
Leander, a city of about 33,000 people that depends on Lake Travis for its water supply. Fielder said the city
has already spent $3.5 million on a new water intake system because its previous pumps did not reach the lake's
low levels. If levels drop more, he said, "Leander's drought-related costs could exceed $10 million.
" Greg Meszaros, director of Austin Water Utility, said the flows through his city's water treatment plants have
been so low at times that the plants' operation has been affected, costing the city money and posing a potential
threat to public health. Environmental and conservation groups argue that water released downstream by the
Lower Colorado River Authority to rice farmers courses through a large portion of the Colorado River,
supporting important fish and wildlife habitat. The loss of that water could cripple the river and its surrounding
land, they say, and cause further damage to shrimp and oysters in Matagorda Bay."This order goes too far," said
Jennifer Walker, water resources coordinator for the Lone Star Chapter of the Sierra Club. She added that the
emergency order, which would only last a few months but could easily be extended, doesn't provide for extra
flows to Matagorda Bay even if the lakes' levels increase significantly.
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10. Rice production falls in challenging season
ABC Rural
By Laurissa Smith
Updated Thu 13 Feb 2014, 3:12pm AEDT
PHOTO: Blighty rice grower John Bradford inspects his crop that's just starting to fill with grain. (Laurissa
Smith)
AUDIO: Rice crops back on track (ABC Rural)
Despite the wind, duck damage and cool weather earlier in the season, rice crops in south-west NSW are
back on track for harvest next month.
The Australian Bureau of Agricultural and Resource
Economics and Sciences (ABARES) reports rice
plantings this summer are down 11 per cent to 101,000
hectares.Murray Valley grower John Bradford says a
smaller rice crop isn't such a bad thing."You know, under
that 800,000 tonnes I think there would be an upside in
the market."We know that the SunRice directors do the
right thing by the growers."With a lower crop, they can
work hard and keep the niche markets and hopefully
we'll get a really good return, up from two years ago at
$317."Mr Bradford has planted 150 hectares of rice this
year at his Blighty farm.He says the rice is starting to fill
with grain and he's pretty happy with how they're
developing."From now, you'll start to see the heads turn and that means there's weight in the grain and that's
what you want.
"It's all very encouraging and there's no reason why these crops can't be bumper crops."
Topics: rice, blighty-2713
First posted Thu 13 Feb 2014, 10:41am AEDT
Thai Rice Subsidy to Expire
Farmers Likely to Face Low Prices When They Return to the Free Market
By :WARANGKANA CHOMCHUEN
Updated Feb. 13, 2014 7:52 a.m. ET
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11. BANGKOK—Thai rice farmers return to the free market when Prime
Minister Yingluck Shinawatra's controversial rice subsidy expires this month, but low
prices portend more tumult ahead for farmers already fighting for payment by the
government.The government's multibillion rice subsidy program was renewed last
year up to this Feb. 28, when the wet season harvest was expected to be over. The
Commerce Ministry said Wednesday the government will let the subsidy expire
because it has no power to initiate a new project or spending.Ms. Yingluck dissolved
Parliament in December and called for a snap election for Feb. 2 in a bid to end street
protests. Her caretaker administration's powers are limited.But while the end of more than two-year subsidy was
near, Ms. Yingluck continued to grapple with finding $3.7 billion, or about 1%, of the country's gross domestic
product, to pay rice farmers for the rice they sold to the state's subsidy.
Hundreds of angry farmers have staged protests in the past weeks to
demand payment for the rice that they say was months overdue and
threatened to stage a bigger rally next week. A group of about 100 farmers
on Thursday filed a court complaint to claim compensation from the
government to cover their rice and interest from the loans they took to
harvest the crop. The Commerce Ministry, which runs the subsidy, has
been speeding up rice sales to generate cash for farmers by offering about 7
million metric tons of rice through the country's futures market on
Thursday and an open tender the day before, hoping to generate some $340
million for farmers. More frequent rice sales were expected in the coming
weeks, Commerce officials said.Ms. Yingluck's government has been
buying rice from local producers for as much as 50% above-market rates
since October 2011.Her flagship rice subsidy was linked to a series of
populist policies launched by her brother, former prime minister Thaksin
Shinawatra, before he was ousted in a 2006 military coup.The subsidy,
which ballooned to about $20.7 billion in three crop years, has gradually run low on funds. But the government
found it difficult to sell its rice stockpiles when a surge in global supply depressed prices.
In Snap:A worker sorts rice bags inside a ship at the Asian Peninsula Corporation Limited factory in
Bangkok.Agence France-Presse/Getty Images
Farmers gather as they take up the street during a rally at the compound of Commerce Ministry in Bangkok,
Thailand on Feb. 10, 2014. Associated Press
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12. Many farmers will be faced with a new challenge: selling rice in the open market as prices continue to
decline.The price of Thai 5% broken rice was recorded at $449 per metric ton in January, down 25% from the
same month last year, according to the U.N.'s Food and Agriculture Organization.Thailand's unusually long
winter and expected severe drought this year could trim the country's rice reserves, but the increasing global rice
inventories and the government's massive stockpile of about 18 million tons—about twice the rice shipments in
a normal year—will likely keep prices down, said Nipon Puapongsakorn, a rural development researcher at the
Thailand Development Research Institute.
"This year isn't looking good for rice farmers.
They may be better off growing something else
that will make more money," Mr. Nipon
said.Manoon Maneechote, a farmer in Phichit
province in northern Thailand, said he expected
to fetch $200 for a ton of paddy from rice
traders, about half of what he was paid under the
rice subsidy. But given that many farmers aren't
being paid, he said getting lower return wasn't
hard to accept.Mr. Manoon and dozens of
farmers blockaded a major road in the province
until last week to demand payment."Politicians
always use farmers as a bridge to power, but
they don't really care about our problems," he said.Ms. Yingluck on Thursday said the government would be
able to start paying farmers next week."The government's failure will cost the party dearly. [Ms. Yingluck's
party] Pheu Thai has built its reputation on populist policy. It can't afford to lose it and have the farmers say, for
the first time, 'The government can't keep its promise,'" Mr. Nipon said.Thailand's anticorruption agency has
started an investigation into Ms. Yingluck's management of the rice subsidy program, which the World Bank
estimated to be incurring $6 billion in losses a year. Ms. Yingluck said she was ready to defend herself.
Ms. Yingluck hasn't ruled out renewing the subsidy, which is crucial to retain support from almost 4 million
households of Thai farmers while her prospect to office remains uncertain.Thailand's Constitutional Court on
Wednesday rejected the opposition's bid to void the Feb. 2 election results, clearing the way for makeup polls in
districts unable to vote because of disruptions by government opponents on April 20 and April 27.It could take
months before a new government can be formed as antigovernment protesters have vowed to continue its
campaign to scuttle the poll to prevent Ms. Yingluck from reasserting her mandate.Farmers like Mr. Manoon
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14. boycotted the election entirely. Nevertheless, the court ruled that the protesters had a legal right to demonstrate
and lower courts should handle any criminal violations.
―Their reasoning was essentially, ‗yes, the Democrat Party did prevent the polls from taking place, but that‘s
criminal violation and that should be handled by criminal courts not by our courts,‘‖ adds Zawacki.The
Democrat Party‘s petition was based on Yingluck‘s failure to hold elections in one day, as is constitutionally
required, but Zawacki called this ―bad lawyering‖ based on a circular and overreaching argument, considering
the opposition‘s key role in blocking the polls.Antigovernment protests have roiled Thailand for some three
months now, during which at least 10 people have been killed and some 600 injured. Protesters want reforms to
be carried out to rid Thailand of the influence of Yingluck and her divisive brother, Thaksin
Shinawatra.Analysts say Yingluck may have dodged a judicial bullet, as intervention by the Constitutional
Court — an institution largely perceived as favoring the Democrat Party — has previously been used to remove
Thaksin-backed governments from office and dissolve former iterations of her Pheu Thai party.Nevertheless,
her administration‘s potential legal woes are far from over.
Thailand‘s National Anti-Corruption Commission is currently investigating the caretaker government over a
failed rice scheme; however, an indictment has yet to be filed.The Election Commission ruled on Tuesday that
new ballots will be held on April 27 for those prevented from voting last month. However, there are also 28
constituencies where no candidates stood due to a disrupted registration process; no decision has so far been
taken on how to fill these seats.
Commerce Min inspects rice warehouse in Suphan Buri
Commerce Min inspects rice warehouse in Suphan Buri
BANGKOK, 13 February 2014 (NNT) – Deputy Commerce Minister Yanyong Phuangrach has inspected a
warehouse in Suphan Buri Province, where rice under the government‘s support program has been kept. In a bid
to build confidence among rice farmers, Deputy Commerce Minister Yanyong has been traveling around
Thailand to inspect rice registered under the pledging program to ensure transparency and the quality of the rice.
Mr. Yanyong has recently visited a warehouse in Muang District of Suphan Buri and found that no rice had
gone off, and none was missing as alleged by a group of people, reiterating that every process was transparency
and open for inspection. Yanyongalso asked the private sector as well as specialists to co-inspect the process of
the rice program and rice warehouses. He however admitted that around 10 rice warehouses in Uthai Thani,
Lopburi, and Phetchaburi have been damaged by either fire or flood.
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15. Commerce Min to release 460,000 tons of rice
Thursday, 13 February 2014By NNT
BANGKOK, 12 February 2014 The Ministry of Commerce is set to auction 460,000 tons of pledged rice today
in a bid to secure funds to pay farmers in the scheme. Bidders have been invited to take part in the auction for
the rice pledged during the 2011/2012 off-season and the 2012/2013 harvest. The government has hoped to
attract exporters or domestic distributors to the auction, which will be held at the Department of Foreign Trade
from 9 AM to 4.30 PM.The unveiling of bidders will take place tomorrow and the results will be announced no
later than Friday.The government has desperately been trying to pay farmers who have pledged their grains
since October of last year. Many have not been paid in more than 5 months.Members of the network of farmers,
meanwhile, remain at the Ministry of Commerce in protest against the government‘s delayed payments.
Rice Exports From India Climbing to Record on Mideast Demand
By Prabhudatta Mishra Feb 13, 2014 9:10 AM GMT+0500
Rice shipments from India, the world‘s largest producer after China, will probably expand to a record as
buyers from Iran to Saudi Arabia boost purchases of aromatic basmati grain used in biryani and pilaf
dishes.Exports are set to increase 7.8 percent to 11 million metric tons in the 12 months through March from a
year earlier, said M.P. Jindal, president of the All India Rice Exporters Association. Sales of basmati may
jump 14 percent to 4 million tons as cargoes of non-basmati varieties advance 4 percent to 7 million tons, he
said in a phone interview.Shipments are increasing from India as Thailand, once the world‘s biggest supplier, is
also set to boost exports.
The Southeast Asian country has built record stockpiles big enough to meet about a third of global import
demand under a buying program that started in 2011. Farmers are demanding the government sell the reserves
to pay for their crop.―India has an edge over other countries because of quality and price competitiveness,‖ said
Faiyaz Hudani, an associate vice president at Kotak Commodity Services Ltd., a Mumbai-based broker. ―When
the output is high and the pace of growth is stable, there is no cause of concern.‖Rising sales may benefit Indian
shippers such as KRBL Ltd. (KRB), LT Foods Ltd. (LTFO) andKohinoor Foods Ltd. (KFL).India is
targeting production of 106.3 million tons in the year through June, compared with a record 105.3 million tons
in 2011-2012, according to the Agriculture Ministry. The harvest would add to global inventories estimated at
109 million tons in 2013-2014 by the London-based International Grains Council.
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16. Thai Stockpiles
The price of Thai 5-percent broken white rice, a benchmark grade, fell 23 percent in 2013, the most in at least
five years, and was at $460 a ton yesterday. A slump to $370 by March is possible as grain is offloaded from
state granaries, according to Chareon Laothamatas, president of the Thai Rice Exporters Association. Roughrice futures on the Chicago Board of Trade rose 0.6 percent to $15.625 per 100 pounds yesterday.Thailand may
not be able to find enough buyers for its stockpiles because major importers in Africa and
the Philippines increasingly prefer grain from Vietnam and India, according to Darren Cooper, a senior
economist at the council.―Thailand will try to dispose of the stockpiles at whatever price it gets,‖ said B.V.
Krishna Rao, managing director of Pattabhi Agro Foods Pvt., an Indian exporter. Shipments may not be affected
by rising Thai sales as the two countries catered to different markets, he said.
Basmati Demand
The U.S. Department of Agriculture expects Thai inventories to reach a record 14.7 million tons this year,
compared with 6.1 million in 2010. Shipments will probably be 8.5 million tons, the USDA forecasts.Basmati
rice exports from India are climbing as Iran is building reserves, said Jindal at the exporters association. Sales
to Iran jumped to 1.28 million tons in the nine months through December, exceeding the 1.07 million tons for
whole of 2012-2013, according to the association. The country is India‘s biggest buyer of basmati and imports
1.5 million tons annually.
―The price of basmati was good this year and overseas demand was more throughout the year from all countries
including Iran and Saudi Arabia,‖ Jindal said on Feb. 4. ―Exports to Iran are higher as it buys for keeping
certain reserves.‖India supplies 65 percent of the overseas basmati rice market, while Pakistan accounts for the
rest, according to the state-run Agricultural and Processed Food Products Export Development Authority. Saudi
Arabia and Iran are the two major buyers of Indian basmati, while Africa is a major destination for non-basmati
varieties.
To contact the reporter on this story: Prabhudatta Mishra in New Delhi atpmishra8@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
Rice seen ruling at current levels next few days
KARNAL, FEBRUARY 13:
Prices of aromatic and non-basmati rice ruled with nominal variation on Thursday.The market is moving at a
snail‘s pace within a positive territory, said Amit Kumar, proprietor of Ginni Rice. Demand for full grain and
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17. brokens is providing support to the market, he said.According to the trade experts, the market may continue to
rule around current levels over the next few days and then it may witness an uptrend in the coming weeks. As
the mercury rises, demand will increase, said Amit Kumar.
In the physical market, Pusa-1121 (steam) sold at ₹9,200
-50, while Pusa-1121 (sela) quoted at ₹8,150 a
quintal. Pure Basmati (Raw) quoted at ₹12,500 . Duplicate basmati (steam) sold at ₹7,050. Pusa1121 (second
wand) was at ₹7,100, Tibar at ₹6,150 and Dubar at ₹5,000 a quintal.
In the non-basmati section, Sharbati (Steam) sold at ₹5,000 while Sharbati (Sela) was quoted at ₹4,800 a
quintal. Permal (raw) sold at ₹2,320, Permal (sela) at ₹2,340, PR (sela) sold at ₹2,900 while PR (Raw)
-11
-11
was at ₹2,800. PR14 (steam) sold at ₹3,225.
About 4,000 bags of Pusa-1121 arrived and went for ₹4,200 a quintal.
(This article was published on February 13, 2014)
Keywords: Aromatic rice, non-basmati rice, nominal variation
Rice basmati eases on sluggish demand, adequate supply
Press Trust of India | New Delhi
February 13, 2014 Last Updated at 15:22 IST
Rice basmati prices fell on the wholesale grains market today on sluggish demand against adequate supplies
from producing region. However, other grains after moving in a tight range in limited deals and settled around
previous levels. Traders said sluggish demand against adequate supplies from producing region mainly kept
pressure on rice basmati prices. In the national capital, rice basmati common and Pusa- 1121 variety eased to Rs
8,700-9,400 and Rs 7,900-9,500 against last close of Rs 8,900-9,400 and Rs 8,100-9,600 per quintal
respectively.
The
following
were
today's
quotations
per
quintal:
Wheat MP (deshi) 2,070-2,270, Wheat dara (for mills) 1,635-1,640, Chakki atta (delivery) 1,640-1,645 Atta
Rajdhani (10 kg) 220, Shakti bhog (10 kg) 220, Roller flour mill 880-900 (50 kg), Maida 950-970 (50 kg) and
Sooji
990-1,020
(50kg).
Basmati rice (Lal Quila) 10,400, Shri Lal Mahal 10,000, Super Basmati Rice, 9,500, Basmati common new
8,700-9,400, Rice Pusa-(1121) new 7,900-9,500, Permal raw 2,100-2,200, Permal wand 2,250-2,275, Sela
2,900-2,925 and Rice IR-8- 1,850-1,875, Bajra 1,260-1,265, Jowar yellow 1,480-1,500, white 2,300-2,500,
Maize 1,400-1,405, Barley 1,385-1,390, Rajasthan 1,080-1,090.
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18. The spectre of rice politics resurfaces
A different interpretation of the definition of ―agricultural produce‖ may mean that politics of rice may be
revisiting the State.The present row over rice has been triggered by the interpretation of the definition of
―agricultural produce,‖ inserted in the Finance Act in 2012. Originally, rice was one among the goods exempted
from the tax levy.Now, it has been brought under the tax net. As per the amended law, agricultural produce
refers to any produce on which no ―further processing‖ is done or such processing is done by a cultivator or a
producer without altering ―essential characteristics‖ but making it only ―marketable‖ for the primary market.
On the implication of the move, D. Thulasingam, president of the Federation of Tamil Nadu Rice Mill Owners
and Wholesale Dealers‘ Associations, says that as per a conservative estimate, the State‘s annual requirement of
rice is 80 lakh tonnes, of which one half comes from other States such as Andhra Pradesh, Karnataka and West
Bengal. Under such circumstances, storage becomes inevitable.Ever since the Congress lost power in Tamil
Nadu 46 years ago, the issue of rice has generated intense political debates in the State.In 1967, when the
general elections were held to the Assembly in the context of the back-to-back nationwide drought of 1965 and
1966, the DMK's promise of supplying three measures of rice (approximately 4.5 kg) at one rupee was a huge
hit, bringing the party to power for the first time.Congress stalwarts K. Kamaraj and M. Bakthavatsalam had to
bite the dust.
It was another matter that the DMK government modified the promise and provided a measure of rice at Re.1
on an experimental basis in a few places. However, the scheme did not last long. In 2006 the DMK promised,
and delivered, to provide rice at Rs. 2 a kg. Some months before the 2009 Lok Sabha polls, the price was
reduced to Re. 1. Two years later, the provision of 20 kg rice free of cost was an important promise of the
AIADMK during the Assembly polls. Chief Minister Jayalalithaa, on her first day in office, issued an order to
this effect. The scheme benefits around 1.8 crore card holders. Those covered under the Antyodaya Anna
Yojana (AAY) are getting 35 kg rice free a month. The annual food subsidy bill comes to about Rs. 5,000 crore,
of which rice component is around Rs.3, 200 crore.
Keywords: Service tax, rice, agricultural
distribution, inflation
produce, rice
transport, rice
storage, Tamil
Nadu
public
Thai army chief says all sides in impasse must "tread carefully"
Every side must tread carefully and refrain from using violence, General Prayuth Chan-ocha said.
World Bulletin / News Desk
Thailand's army chief appealed for calm on Thursday ahead of a long holiday weekend during which organisers of
anti-government protests that have paralysed politics have called for thousands to take to the streets.Protesters have
been trying since November to oust Prime Minister Yingluck Shinawatra, whom they see as a proxy for her
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19. brother, Thaksin Shinawatra, the self-exiled former premier
who clashed with the establishment and was ousted by
the army 2006."Every side must tread carefully and refrain
from
using
violence,"
General Prayuth
Chan-ocha told
reporters after a meeting with the prime minister at which he
reiterated that the coup-prone military was resolved to stay
neutral in the crisis."If any side uses weapons and the other
side reacts, violence will increase and security forces will have
to intervene."Eleven people have been killed and hundreds hurt
in sporadic flare-ups since the protests began, although the last
week has been calm with numbers at demonstrations dwindling.Protest leaders have urged supporters to come out in
force over the weekend, however, and plan "Love Thailand and Break-up with the Thaksin Regime" events
in Bangkok on Friday, Valentine's Day, which coincides with a Buddhist public holiday.The protesters, who are
mainly drawn from Bangkok and the south and are backed by the royalist establishment, say former telecoms tycoon
Thaksin has hijacked a fragile democracy with populist policies to woo poorer voters in rural areas, ensuring victory
for his parties in every election since 2001.In a bid to end the demonstrations, Yingluck called a general election on
Feb. 2, but protesters disrupted the vote in about a fifth of constituencies, meaning there is not yet a quorum to open
parliament and install a new government.Yingluck, whose administration has been reduced to caretaker status with
limited powers until a new government can be formed, said after Thursday's meeting that an election was the only
way to resolve the country's problems."We want an election to take place as soon as possible so that a new
government can come in and resolve the country's problems," she told reporters.
COURT CHALLENGE
On Wednesday, the Constitutional Court rejected a case brought by the opposition Democrat Partyalleging that the
Feb. 2 election was unconstitutional and should be declared invalid. The opposition had boycotted the poll, and
further court challenges are likely.Voting will be rerun on April 20 and 27 in areas where the election was scrapped
or halted early because of the protests.
But there is still no date for polling in 28 southern constituencies - Democrat strongholds - where the protesters have
prevented candidates from registering.The protesters, led by Suthep Thaugsuban, are still blocking big intersections
in Bangkok and preventing civil servants from going to work in many ministries, even if numbers have fallen.The
protest camps are sparsely populated during the day and the body overseeing a state of emergency in place since
mid-January said that little more than 4,000 people were present at the five main sites on Tuesday during the
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21. changed growers.The administration of Yingluck Shinawatra, prime minister, doesn‘t want to shift its vast
stockpiles at a loss but needs to pay off the farmers now adding their voices to a wider anti-government
uprising.―It‘s a real dilemma,‖ said Nipon Poapongsakorn, distinguished fellow and rice expert at the Thailand
Development Research Institute.
―The government has to sell, otherwise it won‘t have the money to pay the farmers and it will lose
votes.‖Thailand‘s commerce ministry said farmers had yet to be paid about Bt115.5bn ($3.5bn) for rice sold to
the government since November, plus a much smaller undisclosed outstanding debt for September.Ministers say
they don‘t have the authority to extend the rice subsidy scheme beyond the end of February, as the government
is a caretaker administration with limited policy making powers pending the outcome of a disrupted February 2
general election, which may not yield full results for months.Faced with road blockades and protests by rice
farmers outside the commerce ministry this month, Ms Yingluck‘s government said it would sell 500,000
tonnes of rice next week from state warehouses, after a 400,000 tender this week was oversubscribed.
But in a sign of the scale of the problem confronting the administration, the two sales together would raise only
about $400m at current international market prices for benchmark Thai 5 per cent broken rice – barely a tenth of
what farmers are owed.Speculation has swirled around the overall cost of the rice scheme that was introduced
by Ms Yingluck after her landslide July 2011 election victory, thanks in part to support from north Thailand‘s
rice-growing heartlands.The government says it spent a total of Bt689bn buying rice above international market
prices during the first two years of the scheme. However, total losses – amplified by a 23 per cent fall in the
international rice price in 2013 – will be hard to gauge until the authorities offload mounting stores it is
estimated will reach almost 15m tonnes this year.It‘s a real dilemma. The government has to sell, otherwise it
won‘t have the money to pay the farmers and it will lose votes.The situation has grown ever more pressing for
Ms Yingluck.
The opposition movement, backed by the country‘s traditional elite, has been campaigning for months to oust
her government and has sought to woo angry farmers, holding whip-rounds for them and giving them a platform
at rallies.The Yingluck administration has struggled to raise funds from bonds and bank loans to support the rice
policy, which has been heavily criticised by the International Monetary Fund but is passionately defended by
ministers as a main plank of efforts to benefit rural Thais.In addition, allegations of graft linked to the scheme
have triggered an investigation by the country‘s National Anti-Corruption Commission and led China this
month to pull out of a deal to buy 1.2m tonnes of Thai rice.Niwatthamrong Boonsongpaisan, commerce
minister, accused anti-government demonstrators of putting pressure on banks not to issue loans for the rice
scheme, adding that only a minority of farmers were protesting against a still-popular programme.―If you talk to
farmers, they all love it,‖ he said in an interview this week. ―If you talk to opposition parties, they don‘t like it.‖
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22. Rice stock offer on AFET draws intense interest
Published: 14 Feb 2014 at 00.11
Newspaper section: Business
In a move aimed at speeding up its rice sales, the government put up 220,000 tonnes of its rice stocks yesterday
on the Agricultural Futures Exchange of Thailand (AFET), drawing several interested potential buyers, mostly
retailers and wholesalers.
Interested buyers submit bids to buy rice from
the Commerce Ministry yesterday. The
ministry‘s plan to sell rice it pledged from
farmers during the 2011-13 seasons attracted 18
bidders. Kitja Apichonrojarek.Rice sold via
AFET for the second time this year would be
mainly from the 2013/2014 season, with 5%
white rice making up 167,000 tonnes from the
state warehouses in Saraburi, Sing Buri and
Chai Nat, and the rest Hom Mali rice 100%
grade B from warehouses in Phitsanulok,
Phayao, Nakhon Ratchasima, Ubon Ratchathani
and Chiang Mai.Somchart Sroythong, directorgeneral of the Internal Trade Department, said
there were 17 interested buyers, with successful
bidders likely to be declared next month, with delivery due between then and June.
Authorities expect this latest sale to fetch more than 1 billion baht. It will be the fifth batch the government sold
through AFET. The state sold 186,000 out of 600,000 tonnes put up for sale in four previous auctions, raising 2
billion baht.Surasak Riangkrul, director-general of the Foreign Trade Department, said authorities are still
negotiating for higher prices with interested bidders who submitted their paperwork, with bargaining expected
to last until midnight last night.The caretaker government plans to sell 500,000 to 1 million tonnes through
AFET.The government's latest effort to sell rice for export drew an overwhelming response from interested
bidders, with 18 potential buyers submitting their bids yesterday to buy 467,623 tonnes in a tender offer. It was
the most active offer in two years, with 10 billion baht expected to be raised.Suvimol Pongpittayanun, the
president of Easternrice Co, a rice exporter to Asia, attributed the good response to the new grains put up for
sale and more flexible conditions that allow buyers to choose from which state warehouse they intend to
purchase.Given the prospect of a severe drought this year, millers are interested in buying up to 500,000 tonnes
of state rice
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23. First 50 rice farmers file court cases against government
Published: 13 Feb 2014 at 18.57
Online news: Local News
A group of 50 farmers has launched the first civil court lawsuit against the caretaker government to demand a
total of 19 million baht in compensation for the rice they submitted to the pledging scheme.The defendants were
named as caretaker Prime Minister Yingluck Shinawatra, caretaker Deputy Prime Minister and Finance
Minister Kittiratt Na Ranong, caretaker Deputy Prime Minister and Commerce Minister Niwatthamrong
Bunsonphaisan, caretaker Agriculture Minister Yukol Limlaemthong, caretaker deputy commerce ministers
Nattawut Saikuea and Yanyong Phuangrach, the Bank for Agriculture and Agricultural Cooperatives, the
Commerce Ministry and the Public Warehouse Organisation (PWO).Rawee Ruangruang, acting chair of the
Network of Thai Farmers for Reclaiming Money under the Rice Pledging Scheme, said farm representatives
and lawyers had supplied the court with pledging tickets (bai prathuan) issued by the PWO when the rice was
delivered to warehouses.
He said there are more than 100 farmers under the network that been affected by the overdue payment, but 50
had already completed the necessary documentation to file their cases. The highest claim for the group was
300,000 baht. More farmers will file lawsuits later. Mr Rawee said the network also considered filing criminal
lawsuits against the caretaker government for fraud. But they will stage a protest at the Office of the Permanent
Secretary of Defence on Monday to ask for details of the progress of the overdue payments.Kriengkrai
Chaimongkol, a leader of a farmers' group in Phayao‘s Dok Kham Tai district, said his group had also gathered
documentation to file civil court cases for compensation plus 7.5% annual interest. They will also file for a
criminal case on fraud charges as well.
―The farmers' problem is about living, not politics. Villagers used to admire the policies of Thaksin Shinawatra
and even now they still like them. However, we have to separate the problem and the policy,‖ he said.In Phichit,
the Provincial Lawyers Council has been instructed by the Law Council of Thailand to assist farmers who had
not yet received payment for the grain they pledged with the government.The council will help more than 100
farmers to file court cases against a miller in the province alleging fraud.The caretaker government owes a total
of seven to eight billion baht to farmers in the province.
For the whole country, the government owes around 130 billion baht to over one million farmers. The
government has said that it has tried several means to get the money, including borrowing from financial
institutions, but no commercial bank wants to get involved in lending money for fear of a crisis of confidence
and damage to their reputation. State-run banks have been subjected to criticism by protesters for wanting to
lend financial support to the government.
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24. The situation has prompted rice growers to threaten to withdraw their deposits from the state-run Krungthai
Bank (KTB) if it fails to offer loans to the rice scheme to meet overdue payments, reports said.Wichian
Puanglamjiag, chairman of the Thai Farmers Association, said farmers are suffering because the caretaker
government has no money to make payments for rice they pledged several months ago.The farmers have no
money for daily expenses and cannot make overdue debt payments, he said.―Farmers understand well that the
government has been trying hard to find money to make the rice payments, but no commercial banks or other
financial institutions have offered the needed loans.
―This is because they are afraid of the PDRC protest leader, Suthep Thaugsuban, who has threatened that banks
that offer loans to the government will face a problem.―It‘s the rice farmers who are facing the negative
consequences as a result,‖ Mr Wichian said.The caretaker government has also tried to release its stockpiles,
after sitting on them for a long time. The latest move is to offer to sell around 687,000 tonnes of different
grades of rice directly to local buyers via auction and through the Agricultural Futures Exchange of Thailand
(Afet).The government expects to generate more than 10 billion baht from the sales.Another 100,000 tonnes
would be offered again via Afet on Feb 26.
Image: A farmer sprays insecticide in a rice field in Suphan Buri on Thursday. (Photo by Thiti Wannamontha)
Overwhelming response to rice sale
Tender offer expected to raise over B10bn
Published: 13 Feb 2014 at 00.07
Newspaper section: Business
The government's latest effort to sell its rice stocks has drawn an overwhelming response from interested
bidders, with 18 potential buyers yesterday submitting their bids to buy 467,623 tonnes in a tender offer.The
tender offer has been the most active in two years since the government has put up its massive rice stocks for
sale, with over 10 billion baht expected to be raised from this tender offer.The rice stocks put up for sale are
from the 2011-12 main crop, 2012 second crop and the first round of 2012-13 harvest season slated both for
export and domestic consumption.
Of the total, 5% white rice would represent 100,360.74 tonnes only for export, with Thai Hom Mali rice 100%
Grade B, provincial fragrant rice, Pathum Thani fragrant rice, 10% white glutinous rice and broken rice
accounting for the rest.Surasak Riangkrul, director-general of the Foreign Trade Department, said delivery of
the rice to the winners is expected within a month and a half.The delivery period is relatively short compared
with three months taken earlier.According to Mr Surasak, since the start of this year, the department has
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25. acquired over 14 billion baht from the rice sales. Since the rice-pledging programme was implemented, the
department has fetched over 170 billion baht.He said the department has sold almost 3 million tonnes both
through tender offers and private purchases, adding that the department will boost tender offers to speed up the
sale of state rice stocks.According to Mr Mr Surasak, given the prospect of a severe drought this year, millers
are reportedly showing an interest in buying up to 500,000 tonnes of rice from the government.
"The government has been trying to dispose of the rice stocks mainly through tender offers about 2-3 times a
month. Next week it will call a new tender for 500,000 tonnes,'' he said.The department will call a
subcommittee meeting on rice sales today to consider the purchase proposal before submitting it to the
commerce minister for final approval.An industry source attributed the active tender offer this time mainly to
flexible and easing conditions, as the government allows successful buyers to sell domestically as well as
export, leading several millers who are mostly packed rice manufacturers to participate in the latest bid.The
millers mostly buy 10,000 tonnes instead of 100,000 tonnes as in the past.The source added that the buying
prices proposed yesterday by the private sector are likely below the market prices, which are now quoted at
13,000-13,500 baht a tonne for 5% white rice.
Price fall hits agri exports
Issues differ across commodities but a common theme of the trade is a lack of sustained govt support,
besides a lack of timely response to feedback
Dilip Kumar Jha | Mumbai
February 12, 2014 Last Updated at 22:33 IST
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26. The recent decline in price of agricultural commodities in both the domestic and international markets has
disappointed Indian traders.Prices of most agri commodities has seen a steady fall since December. Prices of
maize and sugar have fallen 5.3 per cent and 5.7 per cent to close at Rs 1,227 and Rs 2,714 a quintal,
respectively, in Delhi‘s spot market. Sugar faces lack of policy support; bumper supply from Ameria hits
India‘s maize export potential.―The recent downward price movement will be good for import-oriented
commodities, such as edible oil where our dependency is 50-55 per cent.
This will help to lower the cost of imports. However, in the case of exportables like guar or corn (maize) or
even sugar, lower prices would mean lower returns in the international market. The fear is of crop migration;
farmers should not migrate to other crops because prices are low this season,‖ said Madan Sabnavis, chief
economist, CARE Ratings.After a significant boost initially, prices of rice (both basmati and non-basmati) have
fallen by three to four per cent in two months. M P Jindal, president of the All India Rice Exporters‘
Association, attributed this to settlement of differences between America and Iran, one of India‘s preferred
basmati export destinations.“The US, one of the world’s largest producers, might start supply to Iran, post
negotiations. But, our basmati rice will continue to capture Iran’s share. We hope the rice price and exports rebound in
March,” he said.Shipment of basmati and non-basmati rice rose a marginal 0.75 per cent and 0.25 per cent to 2.7 million
tonnes and 5.2 mt, respectively, in the first nine months of the current financial year.
The recent wheat price fall by a marginal 0.6 per cent to Rs 1,650 a quintal offered an opportunity to compete
with global prices. But, frequent change in government policies and poor quality of wheat hit India‘s export
potential. The government sometimes allows wheat exports and after a few months, bans it. Competing
countries like Pakistan, the US and Brazil do not have such frequent policy changes. Global buyers prefer longterm deals. Therefore, India does not get adequate orders. Also, India‘s wheat is used preferably as cattle feed,
due to poorer quality,‖ said Vimal Sethi, director of Pooja Trading Corporation, an Amritsar-based
exporter.More than price fall, the edible oil industry was hit severely because of an inverse duty structure which made
import of refined oil cheaper than crude oil. In 2012, India had imported 1.6 mt of refined oil, with a 7.5 per cent duty
difference. With a reduction in the duty differential to five per cent, the import of refined oil jumped to 2.4 mt in
2013.“Despite a 2.5 per cent increase in import duty on refined oil to 10 per cent now, the price difference between
imported crude and refined vegetable oil works out to $20 a tonne as against the refining cost of $40-50, making
refining unviable in India. For survival of the industry, the government must raise the import duty on refined oil to 14.5
per cent,” said Vijay Data, president of the Solvent Extractors’ Association.
The sugar industry faces a surplus of four mt. The proposed government subsidy might help in better realisation
from exports. According to Abinash Verma, director-general of the Indian Sugar Mills Association, ―The
industry has been waiting for assistance for two months. The window to produce and export raw sugar in this
season will close in the next month. Therefore, the government should take prompt action.‖
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27. Rice exports from India climbing to record on Middle East demand
By Bloomberg | 14 Feb, 2014, 12.57PM IST
Rice shipments from India, the world‘s largest producer after
China, will probably expand to a record as buyers from Iran
to
Saudi
Arabia
boost
purchases
of
aromatic basmati grain.NEW DELHI: Rice shipments from
India, the world's largest producer after China, will probably
expand to a record as buyers from Iran to Saudi Arabia boost
purchases of aromatic basmati grain used in biryani and pilaf
dishes. Exports are set to increase 7.8% to 11 million tonne
in the 12 months through March from a year earlier, said MP
Jindal, president of the All India Rice Exporters
Association. Sales of basmati may jump 14% to 4 million
tonne as cargoes of non-basmati varieties advance 4% to 7 million tonne, he said in a phone interview.
Shipments are increasing from India as Thailand, once the world's biggest supplier, is also set to boost exports.
"India has an edge over other countries because of quality and price competitiveness," said Faiyaz Hudani, an
associate vice president atKotak Commodity Services, a Mumbai-based broker. "When the output is high and
the pace of growth is stable, there is no cause of concern." Rising sales may benefit Indian shippers such as
KRBL, LT Foods and Kohinoor Foods. India is targeting production of 106.3 million tonne in the year through
June, compared with a record 105.3 million tonne in 2011-2012 , according to the Agriculture Ministry. The
harvest would add to global inventories estimated at 109 million tonne in 2013-2014 by the Londonbased International Grains Council. The price of Thai 5- % broken white rice, a benchmark grade, fell 23% in
2013, the most in at least five years, and was at $460 a tonne on Wednesday. A slump to $370 by March is
possible as grain is offloaded from state granaries, according to Chareon Laothamatas, president of the Thai
Rice Exporters Association. Rough-rice futures on the Chicago Board of Trade rose 0.6% to $15.625 per 100
pounds on Wednesday. Thailand may not be able to find enough buyers for its stockpiles because major
importers in Africa and the Philippines increasingly prefer grain from Vietnam and India, according to Darren
Cooper, a senior economist at the council. "Thailand will try to dispose of the stockpiles at whatever price it
gets," said BV Krishna Rao, MD of Pattabhi Agro Foods, an Indian exporter. Shipments may not be affected by
rising Thai sales as the two countries catered to different markets, he said. Basmati rice exports from India are
climbing as Iran is building reserves, said Jindal at the exporters association. Sales to Iran jumped to 1.28
million tonne in the nine months through December , exceeding the 1.07 million tonne for whole of 2012-2013 ,
according to the association. The country is India's biggest buyer of basmati and imports 1.5 million tonne
annually. India supplies 65% of the overseas basmati rice market, while Pakistan accounts for the rest,
according to the state-run Agricultural and Processed Food Products Export Development Authority.
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