Recent News Reports (Part Two):

Rush for rice is expected after Myanmar cyclone

By Bruce Wallace, Los Angeles Times Staff Writer
May 8, 2008

TOKYO -- By strewing death and destruction across a rice-rich delta, the weekend cyclone that battered Myanmar has raised a new question for other poor Asian countries already scrambling to find affordable food: Will damage to its current crop force Myanmar to join the clamor for rice imports at a time when prices are at a record high?

So far, the trend in commodity markets suggests the answer is yes. The price of rice has jumped over the last four days, a sign that traders see a further squeeze on a tight global market.

Storm damage to the Irrawaddy delta, Myanmar's low-lying rice bowl, means that the country is likely to move from being a modest exporter to a major importer, traders say. But other experts say they expect the cyclone's effect on the rice market to be minor, noting that Myanmar produced only 1% of the rice traded on global markets last year.

And though they acknowledge that the cyclone damaged at least part of the current crop and that some supplies were lost, the experts say the next harvest this year may benefit from the cyclone's soaking.

"The moisture on the land is a good thing for rice, so their yearly production should go up, not down," said Vichai Sriprasert, a leading Thai rice exporter and honorary president of the Thai Rice Exporters Assn. "They may have some problems with rice in the warehouses, but even in the delta area, the plant should not have been harmed."

Both sides agree that there will be a short-term scramble for food. Officials from the United Nations World Food Program working in Myanmar reported that at least one major rice warehouse was destroyed, and that another had its roof torn off and its stocks drenched. They also said that much of the spring rice in the field was showing signs of spoilage.

"Our staff report that following the tidal surge, some of the rice was yellow and smelled bad," said Paul Risley, a spokesman for the agency's regional office in Bangkok, Thailand.

But the urgent need for aid to Myanmar is not yet sending the agency looking for new rice supplies. Emergency rice supplies are of little use in an area where there is no cooking oil. Instead, the agency has begun airlifting high-energy biscuits.

Experts say the problem in Myanmar, where the World Food Program was already feeding about a million of the 48 million people, is poor infrastructure and the lack of an effective distribution system.

There is widespread agreement that the country should be able to feed itself. "This is a country blessed for growing rice," said Duncan Macintosh, a spokesman for the Philippine-based International Rice Research Institute.

But production has been stifled by Myanmar's ruling generals, who have set themselves up as the only domestic rice buyer. The government's low prices mean most farmers grow only what they need for themselves, experts say, and as a result, the world's largest rice exporter before World War II now contributes just a trickle to the 30-million-ton-per-year international rice trade.

Yet that capability to grow rice with ease has many observers convinced that Myanmar, also known as Burma, will be able to feed its people again within a few months.

"The rice fields farther north are going to get plenty of water now," said Sriprasert, the Thai rice exporter, who has traveled to Myanmar. "The land and the water there are better than in Thailand; the river systems are huge.

"They'll start to plant soon," he said. "And the crop will be good."