Friday, April 11, 2008

Fears of food shortage as rice prices keep climbing

LARRY JAGAN

Food prices are continuing to sky-rocket throughout Asia, causing many governments to intervene to try to stabilise their domestic rice prices for fear of acute shortages in the future and possible food riots. Many aid agencies working with the region's poorest people, including the UN's World Food Programme, are increasingly worried that food shortages and price rises will severely affect their food assistance programmes.

Rice _ the staple product across the region _ is the main concern, as it has doubled in price over the last two months, and continues to rise. Many exporting nations have implemented bans and restrictions on export to try to dampen local market prices.

Panic buying, rationing and hoarding are increasing alarmingly, fuelled by fears that rice and other foodstuff may run out soon in many Asian countries, despite repeated government calls for calm.

''I am worried about the price of rice _ if it continues to increase I won't be able to buy it because I just won't have enough money,'' said Pong Sothy, a 22-year-old waitress in the Cambodian capital, Phnom Penh. ''Last month my money [salary] ran out halfway through the month because of price rises. So I had to borrow to survive. I just cannot keep doing that.''

''We are buying as much rice as we can now because we do not trust the government to make sure there is enough rice for the ordinary people to buy after Thingyan [next week's water festival that marks the new year],'' said Kyi Kyi, a retired civil servant in Burma's commercial capital, Rangoon. ''Already it's difficult to get enough for our family meals and donations to the monks during the Thingyan festival. We know for sure that the price is going to jump soon, it's already risen significantly since last month.''

From the Philippines to Pakistan, from China to Indonesia, the fears are the same: food shortages and hunger. ''As prices go up in the world market many millions of people across Asia will face food shortages and possible starvation,'' said Paul Risely, WFP's regional spokesman.

Already in Pakistan several families have committed suicide because they could not afford to buy food for their children at the higher prices. Last month Abdul Shakoor, an unemployed labourer in Lahore, killed two of his daughters before committing suicide.

Just three days later, in another city in the same province of Punjab, Kurshid Bibi, the wife of an impoverished labourer, tried to drown her six children before trying to take her own life. She and four of the children were rescued. ''Death is better than slowly perishing from endless hunger and poverty,'' she told police.

It is the most vulnerable who are at risk of hunger and starvation. ''Malnutrition is almost certainly going to rise significantly in many of the poorest parts of Asia,'' said Jon Samuel, director of ActionAid.

The number of people at risk of hunger or starvation in Asia has more than doubled, according to the WFP.

''In Nepal alone the number of vulnerable people has jumped from four to eight million in the last six months as a result of the market price increases and related factors,'' said Tony Banbury the regional head of WFP. ''That's 30% of the population that are in acute need of assistance.''

Analysts fear that throughout Asia the poorest will suffer most and go hungry. In these countries many families spend more than 70% of their income on food. With the substantial increase in rice prices right across Asia, these people cannot buy enough food to feed their families. Government-subsidised rice or international aid programmes are their only saviour. But even these food assistance programmes are now at risk because of the price rises and shortages.

''Our school feeding programmes in Cambodia have been effectively suspended,'' said Thomas Keusters, the head of WFP operations in Cambodia. Schools are on vacation now because of the Khmer New Year holiday and will resume in two weeks' time. ''Effectively there will be no school feeding programme for the rest of the academic year, affecting 450,000 children in grades 1 to 6.''

Supplies of rice to WFP bought in the local market have stopped. Five suppliers have now defaulted and the WFP is short of 13,000 metric tonnes it needs for the programme over the next six months.

Rice importing countries are also particularly alarmed at the rising price of exports, and the increasing difficulty of securing stocks on the international market. World stocks of rice have fallen to their lowest since the early 1970s. Bangladesh, the Philippines and Sri Lanka are all desperately trying to buy fresh stocks of rice at a time when many exporting nations have banned or restricted their overseas sales. As a result, the export price for rice has soared to astronomic heights _ up to three times as expensive as it was three months ago.

The Philippines has only secured half its immediate needs from Vietnam, around 300,000 tonnes, and is expected to bid for more in the coming weeks.

Manila is expected to tender for up to a further million metre tonnes, according to one of Thailand's leading rice exporters, Vichai Sriprasert.

Bangladesh has managed to secure some 400,000 tonnes of rice from India, which has exempted some small quantities of rice for export on humanitarian grounds. Burma has also pledged to supply Dhaka with up to another 500,000 tonnes, though many agricultural experts suspect Dhaka will not be able to afford to pay for all of this.

Earlier this week Burma agreed to supply Colombo with 50,000 tonnes of rice shortly, at the very favourable price of US$400 a tonne, according to Anusa Palipta, a spokesman for the Sri Lankan government.

Sri Lanka is also getting 32,000 tonnes of rice from India and Pakistan in the near future.

But Asian governments remain nervous that the soaring rice prices will fuel political and social unrest.

''The massive food riots in the Haiti capital this week are a wake-up call for all Asian governments,'' according to ActionAid's Samuel.

''If immediate measures are not taken, like protective price and effective distribution mechanisms, there is likely to be food protests here, too.''

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