MUMBAI: Global rice prices, which are already at their highest in 11 years, are set to jump further after India moved to boost payments to farmers, just as water shortage threatens production in key producers and alternative staples get costlier for poor Asians and Africans.
India accounts for over 40 percent of world rice exports but low stocks mean any cut in shipments will fuel food prices driven up by Russia’s invasion of Ukraine last year and erratic weather.
“India is the cheapest supplier of rice,” B.V. Krishna Rao, president of the Rice Exporters Association (REA), told media. “As Indian prices moved up because of the new minimum support price, other suppliers also started raising prices.”
Rice is a food for more than 3 billion people and nearly 90 percent of the water-intensive crop is produced in Asia, where the El Nino weather pattern usually brings lower rainfall.
The global rice price index of the Food and Agriculture Organization hovers above an 11-year high. That comes despite a forecast by the U.S. Department of Agriculture (USDA) for near-record output in all top six global producers — Bangladesh, China, India, Indonesia, Thailand and Vietnam.
