About 3.5 billion people depend on rice as an essential component of their diet, especially in the countries of the Central Asia and Pacific region.
The global rice market is expected to record its largest deficit in nearly two decades in 2023.
Analysts said that a deficit of this size in the production of one of the most important agricultural crops in the world will harm the main importers in various countries.
The commodity analyst at Fitch Solutions, Charles Hart, said that the global rice production deficit is very clear, prompting rice prices to rise to the highest levels in nearly a decade.
It is expected that rice prices will remain high during the current year, to decline during 2024, according to a report published by “Fitch Solutions” on the fourth of April.
The average price of a quintal of rice was 17.30 dollars during the current year, and it is expected to decline to levels of 14.50 per quintal during 2024.
Rice prices are a clear and reliable measure for determining the extent to which global food prices are affected by inflation rates, as it is considered the basic food commodity in many Asian markets, particularly for the poorest families.
The report expected that the deficit during the year 2022/2023 would reach about 8.7 million tons.
Hart explained that a shortage of this size would represent the largest global deficit in rice since 2003/2004, when the world witnessed a shortage in the rice market of about 18.6 million tons.
The report attributed the reason for the lack of rice supply to the continuation of the Ukrainian war, as well as poor weather dialogues in rice-producing economies, such as China and Pakistan.
During the second half of last year, large tracts of land in China, the world’s largest rice producer, experienced heavy rains that caused floods that damaged the crop, especially in Guangxi and Guangdong, the country’s rice-producing hubs.
Rainfall rates in the two cities were the highest in nearly 20 years.
The situation was no different in Pakistan, which is responsible for 7.6 percent of the global rice trade. It witnessed a significant decline in rice production over the past year, by 31 percent, due to the severe floods in the country.
affected countries
Oscar Tjakra, senior analyst at the World Agricultural and Food Bank “Rabobank”, said that the deficit in rice production will raise the cost of importing rice for major importers in Indonesia, the Philippines and Malaysia, as well as African countries, during the world 2023.
For her part, Kerry Gughari, senior research analyst at the “Grow Intelligence” Center, said that many countries in the world may resort to relying on their local stocks to face the crisis.
She pointed out that the countries most affected by the deficit will be those that already suffer from high food prices, such as Pakistan, Turkey, Syria and African countries.
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