As India, Thailand, and Vietnam limit rice export millions of consumers around the world, especially in Asian and African countries are expected to bear the brunt even as several countries are now turning to Mercosur country members for supply of rice which already does not have enough left stock.
The recent ban by India on the export of non-Basmati white rice last month poses a serious challenge. India which is one of the largest exporters of rice says that it has taken this decision to help lower rice prices at home and secure domestic availability.
The suit was followed by The United Arab Emirates, a major importer, and re-exporter of Indian rice, which restricted its sale of rice to other countries. Meanwhile, Thai and Vietnamese exporters reacted by pushing to renegotiate the prices on sales contracts for around half a million tons for August shipments.
Thailand which is another big exporter of rice has received less rainfall this year which has prompted it to urge farmers to plant others that require less water and have faster harvesting cycles in a bid to conserve water.
“The cumulative rainfall is approximately 40% below normal levels, posing a high risk of water shortage,” said Surasri Kidtimonton, secretary-general of the ONWR, in a statement released by Thailand’s National Water Administration on July 31.
Russia had withdrawn from the Black Sea grain deal which allowed for the safe export of Ukrainian grain via the Black Sea amid Moscow’s invasion of its neighbor has a wide impact on the global food market
As a result food security situation could be worsened further due to the disruptions in the global rice trade.
Mercosur countries which have received several requests for the supply of rice are itself not have many tons left in storage. Brazil one of the largest countries in South America is dependent on rice imports from Uruguay, Argentina, and Paraguay.
The price of rice has shot up drastically marking a 14% increase since last June. Warmer, drier weather and erratic rainfall damaging rice production throughout Asia has been primarily responsible for such a rise in rice prices.
Last year, India exported about 22 million tons of rice to 140 countries, comprising roughly 40% of the global cereal trade. Thailand accounted for approximately 15% of the global market demand, while Vietnam contributed 14%.
Economically challenged nations such as Bangladesh, Nepal, Senegal, Benin, and other parts of sub-Saharan Africa are highly dependent on non-Basmati rice imports from India which is going to exacerbate food insecurity for many of these countries.