Rice Price Increase Mystery: Impact on Africa and Climate Change Concerns

2023-06-04 22:04:00

The measures taken by the Indian giant did not foreshadow such a price increase. But restrictions on the export of rice and broken rice imposed by New Delhi since last September have not had the desired effect. The price of Indian rice is now around 460 dollars per tonne for 5% broken rice – FOB price, that is to say excluding transport. A high for at least ten years, which represents an increase of 40 dollars per tonne since January, to speak only of this year, according to data from the Osiriz economic report published by CIRAD

Prices weigh on demand in Mali and Côte d’Ivoire

This increase in India reflects what is happening on the world market where prices have been climbing steadily for several months, but is nonetheless a mystery: “ supply and demand do not justify such a trend “, explains a representative of a large trading house.

Among African buyers and in particular in Mali and Côte d’Ivoire, demand has fallen: ” On the mainland, whenever the price of a 50 kg sack of rice approaches the equivalent of a month’s salary, purchases tend to fall. “, specifies our interlocutor.

On the supply side, Indian exports did not fall and those from Thailand and Vietnam increased. So if in the short term there is no lack of rice, where does this pressure on prices come from? Can inflation alone justify this increase or are there already in the major production basins harbingers of the El Niño climate disturbance, or even a kind of pre-El Niño? The hypothesis cannot be excluded, according to an expert.

► Read also : Rice prices: a grim scenario for 2023

2023 are you the menace of El Niño?

In fact, Pakistan received abnormally heavy rainfall this winter and had to reduce its exports by a third at the start of the year. Indonesia, which imported almost nothing in 2022, might buy 2 million tonnes of rice this year. Bangladesh, Nepal and Vietnam have recently shown through their purchases that they are worried regarding their supply. Thailand has truly formalized its concern and asked rice farmers to harvest only one year due to the arrival of El Niño.

The quality of the first weeks of monsoon will tell if the climatic argument is used correctly and if El Niño will truly be the arbiter of the next season.

► Read also : India bans export of broken rice

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