Dry soil to curb Asia’s early 2024 rice output, pressure supply
![](https://nsn.asia/wp-content/uploads/https://onecms-res.cloudinary.com/image/upload/s--U7ZyUxtA--/fl_relative,g_south_east,l_one-cms:core:watermark:reuters,w_0.1/f_auto,q_auto/c_fill,g_auto,h_676,w_1200/v1/one-cms/core/2023-12-01t021442z_1_lynxmpejb010p_rtroptp_3_climate-change-thailand-rice.jpg?itok=HdSUasY6)
[ad_1]
SINGAPORE : Asian off-season rice production is poised to take a hit as dry planting conditions, shrinking reservoirs and forecasts for continued El Nino weather are set to reduce early 2024 yields, further tightening supplies and spurring food inflation.
India, the world’s biggest rice exporter and No.2 supplier Thailand are expected to see production from their off-season crops decline in the first quarter, while Indonesia, a leading importer, is still reeling from drought as farmers plant their crops, traders and analysts said.
“High prices should encourage planting but there are concerns about water availability from low reservoirs which could see yields losses from off-season crops,” said Peter Clubb, an analyst at the International Grains Council in London.
“India and Thailand are likely to be tighter on the export front. In Indonesia, reservoirs which will supply water for the 2024 dry-season crops came down over recent months during the dry season,” he said.
World rice supplies tightened this year after hot and dry weather fuelled by the El Nino weather phenomenon reduced production in major exporting and importing countries.
Much of the world’s rice shipments come from Asia, where prices in key export hubs have risen around 30-40 per cent in 2023, climbing to their highest in 15 years earlier this year after India restricted exports.
El Nino weather will continue through the northern hemisphere through April-June 2024, a U.S. government weather forecaster said in November, while Japan’s weather bureau has said there was an 80 per cent chance the phenomenon will continue through the northern spring.
TIGHTENING EXPORTS, STRONG DEMAND
With lower rice production and food inflation risks, India is likely to keep restrictions on exports at least until the middle of next year, while Thailand is forecast to have lower surplus for exports, traders and analysts said.
“In the absence of Indian rice exports, Thailand and Vietnam would be expected to account for a sizeable share of global rice deliveries, which will render trade prices sensitive to weather conditions in either market,” BMI, a unit of Fitch Solutions said in a note.
Indonesia and the Philippines, among Asia’s top importers, are securing supplies.
The Philippines has said it has given private traders around a month to buy an additional one million tons of rice to boost local supply and keep prices in check. Indonesia’s state food procurement agency Bulog has secured contracts for 1 million metric tons of rice imports, it said in a statement.
Unlike main crops which rely on rains, off-season crops largely depend on having adequate soil moisture and irrigation.
India’s winter crop, planted in December-January and harvested around March, is expected to drop by one-fifth to around 20 million metric tons, exporters said.
“Soil moisture levels in many producing states are below normal and reservoirs are holding less water than the 10-year average,” said an exporter in Kakinada in the southern state of Andhra Pradesh.
Southeast Asia’s most populous country, Indonesia has seen extremely dry conditions over the last four months, which has reduced soil moisture and delayed rice planting, officials and traders said.
Farmers are expected to start planting in December, and the harvest is expected to occur in May-June, a delay of two to three months, said Arief Prasetyo Adi, chief of the National Food Agency.
Amran Sulaiman, Indonesia’s agriculture minister, told a Nov. 13 parliamentary hearing that the country’s “gorilla El Nino” will last until February.
[ad_2]
Source link