UPDATE: Food crunch

Published: Saturday 31 May 2008

Predictions of food crisis are getting direr, forcing countries to take extraordinary measures (see Food crunch, Down To Earth, April 15, 2008). The UN estimates nearly 100 million more people will have to be provided food due to soaring prices.

Some of the biggest rice producersVietnam, Egypt and Cambodiahave banned the export of rice. Kazakhstan, Central Asias sole grain exporter, banned wheat exports till September, dealing a blow to Central Asian countries, including Tajikistan and Kyrgyzstan. Traders say governments banning the export of foodgrains are fuelling the already soaring prices and exacerbating supply shortages. Sri Lanka also suffered a setback after the World Food Programme decided to suspend its work-for-food programme in the country for lack of funds. After the cyclone Nargis battered Myanmar, Sri Lankas last resort for rice import also seems bleak.

To ease the global supply crisis, India, in the first week of May, announced that it will allow limited rice exports. India, the worlds second-biggest rice exporter last year, banned shipments of all rice except the basmati variety in March, as one of a series of protectionist measures, which had triggered a wave of panic buying.

Meanwhile, the UN has set up a special task force to tackle the crisis and urged rich countries to contribute to food aid for poor countries. The US president has asked the Congress to approve US $770-million in food aid. Thailand, the largest rice exporter, has floated the idea of forming a cartel of rice exporting countriesLaos, Myanmar, Cambodia and Vietnamon the lines of the Organization of the Petroleum Exporting Countries. ASEAN trade ministers have also called for cooperation. (ASEAN countries) will help each other in stabilizing the global (food) price and not take steps that will disrupt the price of rice, the Indonesian trade minister said.

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