Prices high despite record global rice output -DAWN - Top Stories; May 13, 2008

Rice prices chalk up been surging as governments and importers precipitation to inventory up, spurred by growing fears the refreshment staple testament be in short supply. Microcosm paddy industry in 2008 could cultivate by approximately 2.3 per cent, reaching a fashionable create equivalent of 666 million tons, according to our preliminary forecasts," FAO rice professional Concepcion Calpe said in a statement on Monday.

Taken in milled terms, this year"s rice output should rise to about 445 million tons, above FAO"s preceding estimate of 441 million tons and the 432 million tons forecast by the US Agriculture Branch on Friday. For the aboriginal time, paddy production in Asia may surpass the 600 million ton benchmark this year, amounting to 605 million tons," Calpe said, adding that extreme gains were expected all across the region.

In Africa, rice output is forecast to come 3.6 per cent to 23.2 million tons in 2008, assuming acknowledged rains in the outlook months, while paddy output in Latin America and the Caribbean is seen rising 7.4 per cent to 26.2 million tons, the FAO said. The output forecast is abrogating for Australia, the United States and Europe, due to competition from other crops, the Rome-based agency said.

The in fashion forecast may worsen due to the cyclone which hit Myanmar when paddy farmers were harvesting their dry season crop accounting for 20 per cent of annual production, Calpe said. Rice prices rallied about 76 per cent between Dec 2007 and Apr 2008, according to the FAO Rice Value Index, and they were expected to endure at relatively big levels considering stocks held by exporters were expected to be reduced.

Prices are expected to behind too firm, at least until the third quarter of 2008, unless restrictions on exports are eased in the prospect months," Calpe said. At the moment, peerless Thailand, Pakistan and the United States, among relevant exporters, are exporting rice without any constraints." Cosmos rice commerce is forecast to blop about seven per cent to 28.8 million tons in 2008, mostly due to export curbs, FAO said.

Nevertheless yet provided the weather was favorable in the future months and export restrictions were lifted, prices were unlikely to reinstate to the 2007 levels as production costs surged on the back of rising fuel, fertilisers and pesticides prices, FAO said. Existence rice stocks are estimated at 105.2 million tons at the speedy of 2008 marketing seasons, which is slightly below the previous year"s levels, FAO said in a rice report.

Sphere rice consumption is expected to rise two per cent to 437 million tons in milled terms in 2008, with 379 million tons expected to be consumed as food. That method consumption per male would rise to 57.3kg a year from 57kg in 2007, the agency said.-