IRRI warns of impending repeat of ’07 Rice Crisis
Another supply shortage, similar to the crisis in 2007-2008, could be triggered by the impending monsoon season and the decline to bare minimum in the combined stock of milled rice of the top 5 global exporters, IRRI said.
IRRI’s social science division head, Samarendu Mohanty, said on Tuesday that the rice inventory of Thailand, India, Pakistan, Vietnam and United States “can’t go down further.”
The coming onset of La Niña and wet season would be a big challenge to key exporters. Mohanty said. “Right now, these countries were not restricting exports, they seemed to have learned their lesson,” he commented, mentioning the cause of the rice shortage that caused an increase in prices in 2007 and 2008.
He then recalled export restrictions imposed by Vietnam and India back then, which cause stock decline and price spikes as importers like the Philippines struggles to acquire rice supplies.
“While current supplies were still enough, we could not afford any more crop losses after losses due to El Niño,” Mohanty said. “The exporters could panic again, which would bring us back to a shortage crisis.”
Data from United States Department of Agriculture suggest that stock would possibly decline this year by 40%, from 32 million tons in 2015 to 19 million. This would be the most alarming supply crisis since the price spike about a decade ago.
To prevent a probable stock crisis from recurring, IRRI said that joint action from key exporters and different countries are required.