Rice countries want control over soaring prices

Asian countries today proposed forming an OPEC-style group to gain control over spiralling rice prices.

Rice has tripled in cost since the start of the year and along with steep increases in the price of other staples has helped spark violent protests in Haiti and Egypt along with unrest elsewhere amid profiteering and hoarding.

The sudden crisis has experts calling for major changes in food production to improve crop yields and cut waste.

“The world has come together in the past,” said Robert Zeigler, director general of the International Rice Research Institute in Los Banos, Philippines. “I think they could come together again to make sure that humanity has enough to eat. We just need the political will.”

President Gloria Macapagal Arroyo visited the institute, underscoring the need to show an unhappy public that the government is doing something to deal with the rice prices and stock. Ms Arroyo has ordered a crackdown on speculators and angrily demanded to know why more people have not been arrested.

Thailand, the world’s biggest rice exporter, said it wants to form an the OPEC-style cartel with Laos, Myanmar, Cambodia and Vietnam to give them more control over international rice prices.

“Though we are the food centre of the world, we have had little influence on the price,” a Thai government spokesman said.

“With the oil price rising so much, we import expensive oil but sell rice very cheaply, and that’s unfair to us and hurts our trade balance.”

A Laos foreign ministry spokesman said it would “seriously consider” the idea, saying a cartel would give the five countries “bargaining power.”

The run-up in rice prices has come amid global food inflation, poor weather in some rice-producing nations and demand that has outstripped supply.

Some Asian countries, including India and Vietnam, have contributed to the problem by curbing rice exports to guarantee their own supplies.

Cambodia, which has previously championed the rice cartel idea, also welcomed the latest proposal and said it was a “necessity” given the global food crisis.

“By forming an association, we can help prevent a price war and exchange information about food security,” a Cambodian government spokesman said.

But the rice institute’s Mr Zeigler said it would be difficult to apply the OPEC model to rice.

“Rice is grown by millions of farmers in one, two, three hectares (acres) of land. Oil is produced by a few multinational companies in a few countries,” he said.

“So I think the differences are so large as to make any comparison between the two wild fantasies.”

He would prefer to see a world buffer stock.

“If we stay at the status quo, we will always be battling shortages, and that is completely unacceptable,” he said.