Global Economics

Understanding the Global Rice Crisis





And how did that spill over to Asia?


But is there a worldwide shortage of rice?


Who is doing the hoarding?






Why don't farmers just plant more rice?


Is a second "green revolution" possible?

In theory, yes, but it will take time. International Rice Research Institute director general Robert Zeigler says the time lag between new biotech discoveries and implementation on the farm is about 15 years. He also notes there has been underinvestment in rice research by multinational companies because it's primarily grown by poor farmers in developing countries.

Can't planting genetically modified rice help increase supply?

Yes, many varieties are readily available, but the problem is convincing the farmers to buy the seeds. Because rice is self-pollinating, farmers are accustomed to keeping their own seeds. Although hybrid rice is also self-seeding, each succeeding generation is less productive, and many farmers would rather save their cash than buy new seeds every year. "[Genetically modified seed] should be an important part of our toolbox, but it isn't a silver bullet," Zeigler says.

Who is getting hurt the most by soaring food costs?

The poorest populations in the world, for whom rice is a staple and spend the greatest percentage of their incomes on food. The World Bank estimates that 100 million people are at risk. Sub-Saharan African nations are particularly vulnerable because they import 40%-50% of their rice needs. But only 8% of the world's rice output is traded, so most rice-consuming countries actually feed themselves.

What about relief agencies. Can they obtain the food they need?

In theory, yes, the supply is available since much of relief food is actually sourced locally, so the drop in rice available for export has no direct impact. But since prices have risen so much, their budgets are stretched to the limit. On May 1, the World Food Program in Cambodia will stop buying locally produced rice, which it had been using to provide breakfast to 450,000 needy school children. It's abandoning the program because of spiraling prices. And the government of the Philippines, which is the world's largest rice importer, has only been able to buy part of the rice it imports because exporters have not responded to its tenders in full.

What short-term methods could boost supply?

More investment in irrigation. Better storage methods and low-cost devices such as moisture meters, which could help farmers avoid wastage. Also, greater use of hermetically sealed bags would prevent infestation.

Too Cool for Crisis Management
blog comments powered by Disqus