Safety first

To start off this update, we need to move away from Cambodia, away from Asia. It's the U.S.A. where a precedent is being set, which is another nail in the coffin of those banking on consumer power.

Initially it looked like a gain for campaigners, who have been able to force the U.S. government to label food from GMO sources. The bad news: the label doesn't actually have to be readable to the consumer!
Al Jazeera (Aug. 5):

'Food safety organisations in the US have condemned a new law they say will allow food producers to obscure the labeling of genetically modified ingredients in their products, despite widespread health concerns over the effects of GMOs and the pesticides associated with them.
Signed into law on Friday by President Barack Obama, the legislation permits manufacturers to inform consumers of GMO content through the use of Quick Response or QR codes, which require a device - such as a smartphone - to read.
The law was passed despite opposition from environmental and food safety groups, as well as national polls which show that some 90 percent of Americans surveyed favoured clear labeling.
...
Paul said that more than 300 food and pesticide makers spent nearly $400m over the last four years in lobbying efforts to defeat the mandatory labeling of GMOs.
"We failed not because of lack of support from consumers - but because of the enormous amounts of money thrown by the industry," Paul [Katherine Paul, an associate director of the Organic Consumers Association] said, adding that she was disappointed by Obama, who once vowed to enforce clear GMO labeling'.

The law also fails to stipulate penalties if found in breach of the law.  
Let's hope that the most probable outcome will be the opposite: food without GMO sourcing will be labelled clearly GMO-free! 

More or less on the same subject, the Ground Reality blog takes a pot shot at the conclusion arrived by Nobel laureates that we all should swallow the GMO pill. 
From IRRI.org (Jun. 23):

'On the subject of genetically engineered foods, this rings true. After years of debate, the prestigious National Academies of Sciences, Engineering, and Medicine has released its verdict: there is no substantiated evidence that food from genetically engineered (GE) crops were less safe than food from non-GE crops'.

Then the Ground Reallity response (Jul. 17):

'But first let’s look at the usual scientific rhetoric that I find is repeated worldwide ad nauseam: “Opposition based on emotion and dogma contradicted by data must be stopped.” Whose data? The data produced by GM companies or the data produced based on the research funded by biotech giants? 

...

To say that scientific and regulatory agencies around the world, which find GM crops as safe as, if not safer than those derived from any other method of production, is a clever ploy to hoodwink public opinion and thereby push harmful and risky crop production technologies.

...

What has to be accepted is that the food crisis the world witness is not because of any shortfall in production. The problem is because of the absence of food justice, which in other words means access and distribution'.

Gold rush no more
The bigger picture is that like many exporting countries, Cambodia is struggling in it's ambitions to gain more market share as the overall world market gives mostly purchasers the power to bargain.
The Phnom Penh Post (Jul. 8) kicks off the concerns:

'Cambodian rice exports decreased nearly 6 per cent year-on-year during the first semester, reinforcing concerns about the future of the rice industry, the Kingdom’s most important agricultural sector.

...

Rice industry experts say the sector is suffering from a number of issues, including competition from low-cost Vietnamese imports, high production costs, and millers’ lack of finance.

According to CRF president Sok Puthyvuth, who was re-elected for a second term last Saturday, the issues have already resulted in between 10 and 20 per cent of the nation’s rice millers declaring bankruptcy'.

The Khmer Times (Jul. 18) chimes in:

'Cambodia’s rice industry has been advised by the European Union (EU) to seek other markets and not just concentrate its exports to Europe, as it moves from a low-income country in its least developed country (LDC) status to a lower-middle income nation, amid calls to cut its EU tariff-free export quotas.

...

According to Oryza, the daily online markets newsletter, Italy is pushing the EU to cut LDC rice imports from Asia to protect the Italian rice market that seems to be getting bigger'.

One way round trade issues is reported by Phnom Penh Post (Aug. 3). Cambodia has asked China to double it's rice imports which as Cambodia is the only country to support China in the South Chinese Sea. Anyway:

'China will also consider increasing the export quota on Cambodian rice to 200,000 tonnes starting in 2017, as well as continuing to negotiate on the exports of broken rice, banana, mango, longan, cashew nut, pepper, coffee and soybean. The current export quota on rice to China is 100,000 tonnes per year.

Ministry spokesperson Soeng Sophary stressed that while the talks were fruitful, no official decisions were made'.

Future for Cambodia's rice not bright? Phnom Penh Post (Aug. 3):

'An industry analyst has issued a dire forecast for Cambodia’s rice sector, claiming the long-grain “white gold” that has been credited with lifting millions of Cambodia’s farmers out of abject poverty, and which seems a natural fit for the Kingdom’s agrarian workforce, is on a downward trajectory.

Jim Plamondon, a former technical evangelist for Microsoft who is developing new marketing strategies for Cambodian rice varieties, says the Kingdom’s rice industry – the lifeblood of its agricultural economy – is headed for a brutal and imminent consolidation'.

Basically lots of policies on rice import and export are based on the once in a lifetime price spike of 7 years ago, something that will not happen in the near future. With prices sluggish or dropping it's traders and millers who most probably have bought at too expensive terms and are facing losses.

Did I hear niche markets? The Khmer Times (Jul. 14):

'As the demand for organic rice in European and United States markets keeps growing, many local rice millers and exporters are moving quickly and signing contract farming deals to supply them with the premium product'.

There's ongoing confusion concerning branding Cambodia's rice. The Phnom Penh Post (Jul. 21) looks to bring clarity in this, but it seems this will not clear itself.

'The private sector’s campaign to develop a single recognisable umbrella brand for Cambodia’s premium varieties of fragrant rice looks increasingly tenuous after a government body voiced objections to the name selected, and argued instead that the country should market each variety of rice under its own individual brand name.'

Warnings
Well, self-explanatory, not only is Cambodia facing a difficult export market. Vietnam's Thanhniennews (Jul. 19):

'Vietnam has reduced its rice export target for the year since demand is falling as many buyers await cheap supply from Thailand’s stock clearance sale.
The Vietnam Food Association (VFA) said it has reduced the export target from 6.5 million tons to 5.65 million tons, Tien Phong newspaper reported'.

The Bangkok Post (Aug. 4):

Thailand's rice market is expected to face a price war next year as a result of oversupply that will lower prices in both domestic and export markets, while the stronger baht could hurt the competitiveness of rice shipments, exporters warn'. 

So no good news for farmers, though the absence of drought would mean better harvests. But with prices set to drop, it's traders who won't be interested in buying as they might face increased losses. So farmers will get stuck.

How should Thailand compete even better? The Bangkok Post (Jul. 27):

'The government is being urged to exercise the powerful Section 44 of the interim charter to cut red tape and speed up sales of state rice stocks'.

Same recipe everywhere ...

Moving on, the Bangkok Post (Jul. 25) has some wider implications of new trade trends:

In 2014, Thailand imported only 593,000 tonnes of wheat.

The figure rose to 3.46 million tonnes in 2015 and will reach an estimated 5 million tonnes this year.

Higher imports have affected domestic prices of maize and tapioca chips in recent years. Wheat imports come at the behest of animal feed producers which are feeding the chicken boom ...

Scape goat
The Bangkok Post (Aug. 2) notes that the nonpolitical trial of the former democratic government by the current junta revolves around the possible loss of what they now estimate as 26 bn Bhat. Though how this figure is arrived at is unsure as previous attempts to pinpoint the exact losses resulted in data that were much higher. 
It also seems that the timing of this is more significant: just a week before a referendum on a new constitution that no political party favours with the outcome that either a new constitution is voted in thereby guaranteeing the junta constitutional influence. Or if not approved by the electorate the junta will also remain; a win-win situation.

Faced with the formal accusations, the former PM responds (Bangkok Post, Aug 5):

'Former prime minister Yingluck Shinawatra told the Supreme Court on Friday that her loss-ridden rice-pledging programme really helped debt-ridden farmers and the national economy.
...

Ms Yingluck told the court that pledging prices set at 15,000 to 20,000 baht per tonnes were not too high because they were aimed at enabling rice growers to earn equivalent to 300 baht per day -- the same as the daily minimum wage for labourers -- and resolving their chronic indebtedness, she said'.

Seems fair.

Flood

Vientiane Times (Jul. 28) notes that coffee is becoming an alternative crop in the northern province of Phongsaly:

'Phongsaly, long renowned for its green tea, is set to be the nation's first coffee producer in the north after around 3,000 hectares of coffee trees were planted in the province'. 

Apparently this has been going on for a couple of years under Chinese guidance.

Then again, in Cambodia coffee growing is not so positive. The Phnom Penh Post (Aug. 3):

'Samban [director of the Agricultural ministry’s department of industrial crops] attributed the contraction to the impact of recent droughts and the volatility of global coffee prices, as well as a flood of cheap imported coffee into the market.
The shrinking market for locally produced coffee has not discouraged MK Mondulkiri Company, which has found a niche supplying organic Cambodian coffee to the local and international market.
Orn Chanthy, the company’s CEO, said the competition in the coffee retail market was fierce, but many consumers recognise that cheap products are often of inferior quality.
“It is hard to compete on price as coffee can be imported cheaply, though without any assurance of quality,” she said. “There is a lot of fake coffee in the market and some coffee [deceptively] uses the name of our coffee-growing region.”
Chanthy said exports of MK Mondulkiri coffee increased last year, with shipments going to European and Asian buyers, though she declined to provide figures'.

So with China seeking more and more land for banana's, it's no wonder that Cambodia may well be next in line. The Phnom Penh Post (Aug. 2):

'A Chinese agricultural company has agreed to establish a banana plantation in Cambodia, according to a senior government official'.

Info on Mong Reththy Group. Phnom Penh Post (Jul. 18) notes how it will step into the agrofeed mill business:

'Agro-industrial conglomerate Mong Reththy Group is constructing a new $10 million feed mill to supply its own livestock operations as well as the domestic market, the group’s eponymous president and CEO said yesterday'.

While on Jul. 6 the same source focuses on the companies palm oil operations:

'Export of crude palm oil from Mong Reththy Group, the Kingdom’s only active producer, doubled during the first half of the year despite prices showing no indication of improving, a company executive said yesterday'.

Finally the Bangkok Post has put up two video's which highlight award-winning Eastwest Seed business. There's this (Jun. 12) on the business explaining also why they are not so interested in GMO seeds. And this (Jul. 10) about the way that the company is for instance pushing the marigold business.

Voices

It's funny how relevant issues are not receiving the importance they deserve. One such issue are the new trade deals drawn up by the USA.

Relevant for the region is the Trans-Pacific Partnership (TPP) trade initiative which has recently been concluded; a new trade deal between 12 Pacific Rim countries. Regional signatories in this are Vietnam and Malaysia.

Problems are that it's not (yet?) clear what has been achieved (discussions were secret), though it seems to be a win for big corporations. This may well pave the way for hybrid rice production and trade to increase. 

For non-hybrid rice trade, it's expected that Vietnam will gain more favourable access to the U.S., while Japan manages to keep imports largely at bay albeit for some token imports.

Cambodia is not part of the TPP, though may well be affected especially where it comes to competing with Vietnam. The Phnom Penh Post (Oct. 7) looks at possible developments:

'Some exporters of Cambodia’s biggest agricultural crop also voiced concern over the new trade pact, suggesting it would limit their expansion into the US market.
Song Saran, CEO of Amru Rice, one of the Kingdom’s largest rice exporters, said Cambodian rice accounted for about 2 to 3 per cent of the US market last year. He said that while this represents only a small share of the market, the TPP would restrict any future growth.
“We are not affected by the signing of the TPP, as rice exports to the US are not big as compared to garments,” said Saran. “But it will be challenging to expand our market share in the US.”

Aggressive

Though there seems to be a slight hiccup, rice exports from Cambodia are on the up. Phnom Penh Post (Oct. 2):

'Rice exports fell sharply last month, but the Kingdom’s most important crop is expected to recover and end the year in positive territory.

...

However, September’s dip should have minimal impact on the Kingdom’s annual export tally, according to the UN’s Food and Agriculture Organisation (FAO). Direct milled rice exports between January and August were about 340,000 tonnes, nearly 50 per cent up compared to the same period a year earlier, it noted'.

Noted is that Cambodia is becoming more and more dependent on European and Chinese imports, areas where the Vietnamese have less bargaining value.
 

Cambodia Daily (Oct. 2) sees that the Cambodian rice players hope to exclude national cheaters from exporting: 

'The Cambodia Rice Federation (CRF) on Wednesday announced strict penalties for exporters who mix Cambodian rice with low-quality rice from other countries after receiving complaints that some exporters have been using the method to increase profits'.

It still seems that exploring rice niches may well be the way forward. Khmer Times (Sep. 30):

'Domestic rice millers are preparing to compete against their Thai rivals for a share of the US market as the European Union market becomes increasingly competitive, they say.
The move, which will see the Kingdom’s premium rice competing with Thai jasmine rice, which dominates rice imports by the US, is part of an overall strategy to diversify export markets, rice exporters say.  

...
Economist Srey Chanthy agreed that domestic rice millers will face immense challenges competing with Thai rice in the US market. It is “very difficult to compete with Thailand,” he said. “Maybe Cambodian [exporters] should capture a niche market, like organic rice, or conduct aggressive marketing campaigns and target Cambodian communities as a start,” he said'.

Change

Vietnam seems this years loser when it comes to rice exports. Concerning having (or not) an edge on their competitors,  Vietnamnet (Sep. 21) interviews Dr. Nguyen Do Anh Tuan, Director of the Vietnam Institute for Policy and Strategy of Agriculture and Rural Development (IPSARD):

'To compete amid rice oversupply and consumers preferring to use high-quality rice, the [Vietnamese] rice sector must improve the quality of rice to participate in niche markets which are small but have high value'.

From Thailand the quirky news is that rice farmers should move along. The Nation (Oct. 5):

'The government has called on farmers across the country to grow plants that require less water than rice amid the ongoing risk of drought.

...

... after rice farmers in Kanchanaburi expressed dissatisfaction over the government's plea that they avoid growing rice outside the rainy season'. 

The same source on the same day also has this article which starts off as follows:

'[Thai] Farmers are growing a dry season rice crop - despite authorities' warnings - and have urged the government to come up with concrete policies to help rice growers during the dry season. 

As the dry season approaches, the Royal Irrigation Department (RID) has warned farmers in the Chao Phraya River Basin not to plant the dry season rice crop. They say the available water in the four major dams is not enough for agriculture. Officials suggest farmers cultivate fewer water-consuming plants - or change jobs and become labourers.

...

"We are told to change jobs - to be workers or otherwise plant corn, vegetables or beans instead. This hurt my feelings so much. We are farmers - and furthermore, vegetables do not sell well and are cheap," she [Wassana Gromtu, a farmer from Phitsanulok's Bang Rakam district] said'. 

The Nation (Oct. 2) continues:

'Agriculture and Cooperatives Ministry permanent secretary Theerapat Prayunrasiddhi said the ministry had ordered the Royal Irrigation Department (RID) to inform farmers in the Chao Phraya River Basin about the water situation in order to encourage them not to grow the dry-season rice crop.

...
"During a drought, we see that 80 per cent of farmers outside the irrigation area can adjust well to the situation because they are familiar with water shortages and can change their production pattern, unlike those in the irrigation areas who are used to easy access to water," Wiwat [Wiwat Salyakamthorn, Agri-Nature Foundation president] said. He concluded that the farmers needed to help themselves during drought, as the government cannot provide help to everyone. He urged them to learn mixed farming and have their own water reservoir on their land'.

Trade

The UN's FAO suggests a slight decrease in this years rice output in Cambodia (FAO, Sep. 23):

'FAO currently anticipates the 2015 main season rice production to fall by 3 percent to 7 million tonnes. Assuming more normal growing conditions for the latter half of the ongoing main season and larger sowings for the forthcoming 2015/16 dry season which may partially compensate for the losses incurred by the earlier dry weather, the 2015 aggregate rice production is forecast at 9.18 million tonnes. This is 2 percent down from last year’s bumper crop and slightly above the five-year average'.

Stratfor Global Intelligence (Sep. 23) looks at China's rice market as seen from the US perspective. 
One aspect they concentrate on is how China's food security strategy is maturing, which may enable more imports. On the other hand they note how the US agriculture's dependence on GM strategies is increasing. This in turn raises the likelihood of GM strains turning up in exports thus possibly affecting these. As China has done so in the past.

'Considering the resource scarcity much of the world will face in the coming years and decades, genetic engineering is poised to be a growing part of agricultural strategy, and so contamination will only become more likely. Even though there is already domestic development of genetically modified strains of rice, Beijing is likely to be extremely cautious about accepting foreign genetically modified crops, especially for staples like rice. Furthermore, as Beijing seeks to build up its own agricultural biotech sector as part of its food security strategy, we could see regulations shift accordingly'.

Required
Phnom Penh Post (Sep. 30) has an article on how pepper grown in and around Kampot is gaining better markets at better prices due to good quality control.

'A report released by UNCTAD this week showed that “prices for Kampot pepper had increased significantly after producers gained access to wider and more diversified markets as a result of GI certification”.
In one case study, Kampot pepper producer Starling Farm saw the farmgate price of its product increase from $5 per kilogram before GI status in 2010 to about $18 in 2014'.

Meanwhile Thai rubber farmers want more (Bangkok Post, Oct. 15). In short, a minimum  price, the ability to swap rubber for rice with the government, a review of forest policies vìs-a-vìs rubber plantations on demarcated forest lands and landless rubber farmers and tappers should have the ability to register with the government.

Other news which might have a slight touch to rice trade comes from the Phnom Penh Post (Sep. 25):

'The ministry of Agriculture plans to establish five regional food safety inspection offices near the country’s borders to facilitate the flow of cross-border agricultural trade, reducing the time it takes Cambodian exporters to deliver shipments of agricultural products to foreign markets, a ministry official has said'.

Oddly imports don't face the same requirements. 

Lead or the lead?

As usual we could lead this update with the newest on the Thai rice pledge scheme, loads of info to be had on this. But we're not.

Instead let's look at what would have been an unknown study on lead levels in rice. If not for what?

A popular way to scare away the foreign competition (from the US of A) is to label them unsafe.  The tool: studies into consumption rice lead levels. It revealed that  foreign rice has lead levels in excess of standards set by the US-FDA (but has no reference on domestic rice):

'New research has revealed that samples of imported rice sold in the retail markets in the U.S. contain levels of lead that are higher than permissible levels, according to a report by the BBC.

The study was conducted by Dr. Tsanangurayi Tongesayi of Monmouth University in New Jersey, US, and his team. The study found that lead levels in some samples exceeded the "provisional total tolerable intake" (PTTI) set by the US Food and Drug Administration (FDA) by a factor of 120. High levels of lead can affect the kidney, brain and other parts of the human body.

Rice from Bhutan, Italy, China, Taiwan, India, Israel, the Czech Republic and Thailand were used in the tests, and almost the samples had high levels of lead. "When we compared them, we realized that the daily exposure levels are much higher than those PTTIs," said Dr. Tongesayi. "According to the FDA, they have to be more than 10 times the PTTI levels (to cause a health concern), and our values were two to 12 times higher than those 10 times," he told BBC News. Tests on imported rice from other countries are in the process'.

The  above was reported from Oryzae.com (Apr. 11). Further scaremongering: 

'According to the research, rice from China and Taiwan had the highest lead levels. One of the reasons why rice samples contained high lead levels is the fact that some countries use raw sewage effluent and untreated industrial effluent to irrigate rice fields, said Dr. Tongesayi. He added that there is a need for international regulations over production and distribution of food grains'.

But why are there high levels of lead in rice from Thailand? Or from Bhutan? 

The BBC then adds:

'Update 24 April 2013: This story has been amended to emphasise the preliminary nature of the results, which are under review both by the authors and the journal to which they were submitted for publication'.

And from Natural News (Apr. 21): 

'A recent scientific paper that concluded imported rice was heavily contaminated with lead has been suddenly withdrawn by its author. Natural News has confirmed from the author, Monmouth University Chemistry Professor Tsanangurayi Tongesayi, that the paper is "recalled until further notice."

...

Here's another clue worth considering in all this. In 2012, Consumer Reports published results of its lead analysis of 223 brands of rice. They also measured arsenic and cadmium in rice.
If you click the link above, the chart you'll see is shown in parts per BILLION. These numbers, in other words, are 1/1000th the value of numbers given in parts per million. As a reminder, 1000 ppb = 1 ppm.
If someone asks you, "Would you rather each 500 ppm of lead, or 500 ppb of lead?" the correct answer is ppb.
The Tongesayi team was announcing that it found rice to contain high ppm of lead. But the Consumer Reports team -- which of course has decades of experience running tightly-controlled lab analysis activities -- was only reporting lead at ppb in rice.
Somebody is off by a factor of 1,000. That's three orders of magnitude. And I'd bet my favorite pair of hiking boots it's not Consumer Reports'.

! 

IRRI wakes up (May 3): 

'“The most important issue for me at this point is to make sure the data is accurate,” Dr. Tongesayi said. “If it is not accurate we will obviously not publish the paper.”'

Too late?

Cambodia + rice

Cambodian rice exports are on the upswing. Oryza.com mentions (May 2) figures of +130% for the first 4 months! 

It also notes that Thailand is one of the principal destinations ...

Another destination is the Philippines according to Cambodia Daily (Apr. 8):

'Commerce Minister Cham Prasidh has signed a rice deal with the Philippines, as Cambodia tries to find new markets for its increasing supplies of domestically milled rice'.

The Cambodian Daily (Apr. 18)  reports on energy from biomass from rice:

'A U.S.-based energy company has announced that it is planning a biomass project using genetically modified rice in Cambodia, in a purportedly massive deal about which little information has been made public'. 

Particularly the section on GM rice seems interesting: 

'According to the statement, Sino Bioenergy’s “super rice” seeds, which are produced in laboratories, “are disease resistant, high yielding genetically improved rice with the transgenic rice grain length increased by 25% over normal rice.”'. 

Oddly it points to the company's own seeds, though on it's website they don't mention rice seed as one of their activities. Are they going to be duped ...? 

Oh and the Cambodian Daily adds: 

'The company’s [Sino Bioenergy] listed phone number in Hong Kong connected to a person who declined to give her name, but said, “Sino Bioenergy is using our registered address. This is not their office.”'

!

Another company involved are Sky Energy. 

'To enhance Cambodian rice yields, the government should encourage private development of rice-seed production and focus its efforts on farmers’ education and regulations that ensure the quality of seed, industry experts say'. 

So reads an article by the Phnom Penh Post (Apr. 25). Oddly, private sector investment and rice seed are not a natural symbiosis globally and Cambodia is not different. There's simply not enough financial reward for the hard work of breeding. So why this call?  The article isn't clear. It does note:

'After a number of attempts, MAFF declined to comment.' 

Yawn.

Setting standards for rice: 

'Building an industry based on a uniquely Cambodian standard will give rice producers a clear target to work towards and instil confidence in buyers, said a panel of both government and private sector representatives at a rice quality workshop in Phnom Penh on Tuesday'.  

Source: Phnom Penh Post (May 2)

The Asiafoundation.org reports (May 1) on Cambodia's potential:

'If Cambodia’s rice export sector were to reach its full potential, it could produce 3 million tons of milled rice, with the total export value amounting to $2.1 billion (approximately 20% of the GDP) and an estimated additional $600 million (approximately 5% of the GDP) to the national economy. It would also boost employment and income for agricultural farmers who make up more than 70 percent of the population living in rural areas'.

It also knows where the problem lies:

'Most Cambodian farmers cultivate paddy rice once per year during the rainy season, while farmers in Vietnam’s delta region cultivate 3.5 times annually. Such low productivity is mainly a result of high energy prices and poor transportation infrastructure'.

Well, it forgets the value of irrigation, even during strict Communist times with little or no energy at all, the Mekong delta still could produce more than 1 crop a year. The two sources mention are only impediments in achieving global competitiveness.

The guru of SRI (System of Rice Intensification), Norm Uphoff, visits his favourite son, Cambodia (Cornell News, May 2): 

'In his remarks at the conference, the minister [ Cambodia's minister of agriculture, forestry and fisheries] reported that use of SRI methods in Cambodia has expanded from small trials done by 28 farmers in 2000 to more than 200,000 farmers. Yields are 50 to 100 percent higher for paddies using SRI, and those yields are achieved with lower production costs. As a result, he said, farmer incomes from rice production can be doubled or more with SRI'.

Thailand is facing a crunch in supplying the world with maize and cassave. So now all of a sudden the Thai's are doing their best to open the borders for this produce (Phnom Penh post, Apr 23): 

'In order to boost the Kingdom’s trade performance and improve the quality of lives of farmers along the Thai-Cambodia border, Thailand has agreed to remove import restrictions on Cambodian cassava and maize'. 

Expect restrictions to be re-imposed once the export markets of Thai turn.

Woeful

An editorial from the Bangkok Post (Apr. 4) asks the government to admit defeat

'Come clean [on rice pledging]

Finally, the government has agreed to accept the hard truth that it can no longer buy every grain of paddy from rice farmers as promised when it launched the populist rice pledging scheme two years ago'.

The Thai government are hopeful (The Nation, Apr. 6) of offloading 6-7 million tons of rice this year:

'As the government is able to continue to release rice from the stockpiles, he said, the country should be able to get some return the total outlay of Bt410 billion during two years of the pledging programme'.

But, says the Bangkok Post (Apr. 7), exporters are in the camp of the non-believers: 

'Korbsook Iamsuri, president of the Thai Rice Exporters Association (TREA), said it remains difficult to assess whether the government could sell its rice stocks, as it has yet to call an auction for exporters'.

If all fails, exporters have a solution (The Nation, Apr. 9): 

'A source from a giant rice-export company said the government should release its older stockpiles for use in feed-meal production, to make way for new-harvest rice that will need to enter the warehouses.
"The government needs to clear its rice stocks urgently, in particular rice from previous harvests since 2005 because it is deteriorating in quality. These rice stocks could be used for supplying feed-meal producers," said the source'. 

Blasphemy? Why not name the source ...? 

Bloomberg has a good article (Apr. 18) on the rice-pledge saga. Note: 

'Rather than sell the rice on the open market—and risk embarrassment as private dealers see the haircut the government is taking—Thailand is trying government-to-government deals that allow buyer and seller to keep prices secret.

...

The Thais are selling into a soft market. “There is just no demand for this rice,” says Jac Luyendijk, CEO of SAT Swiss Agri-Trading. “You have to dump it.” Swiss Agri-Trading now buys about 30,000 tons of Thai rice, down from about 200,000 tons before 2011'.

Separately Bloomberg (Apr. 20) sums up the pro's of the scheme and estimates the costs: 

'Given the extra income for farmers, which is also helping to increase consumption in many rural areas, the government is unlikely to completely abandon the scheme despite the cost, but the rice pledging scheme is seeming to be like a snowball. At the beginning, the problem doesn’t look so big. An extra 45 billion billion for such increased income is something that the government would be prepared to take a hit on. However, unless there is a change in the international market, exports are likely to decline again, production to increase (and thus increased costs), and more rice stockpiles. If costs are 140 billion for October 2012-September 2013, what will they be for the following year'

The loss has just increased, as the price has just eased  ...

Adding to Thai woes are the price of the bhat whereas if you want to sell on the international market the price is in $ US. So with the bhat increasing one can blame failure on the international finance. Bangkok Post (May 1): 

'Commerce Minister Boonsong Teriyapirom has blamed the soaring baht for hampering government-to-government (G-to-G) rice export deals'.

And even more. Bangkok Post, May 3: 

'The Thai baht's rally to the highest level in 16 years is hindering exports from the world's biggest rice shipper, curbing the government's efforts to diminish record state stockpiles and threatening to increase its losses.

...

"Any success in offloading stocks will result in heavy losses for the government," said Darren Cooper, a senior economist at the London-based International Grains Council, which monitors global markets and promotes food security. "So the baht strength will merely add to what are likely to be very hefty losses."'

A plus:

'Higher rice reserves in Thailand may help increase global inventories to a record 173 million tonnes, according to the United Nations' Food and Agriculture Organisation, which forecasts that world production will exceed demand for an eighth year'.

Outmarketed?

More foreign misunderstandings? The Nation (Apr. 17) reports that China based importers are mixing the expensive Thai rice with that of cheaper (and lower ?) grades. Consumer protection is still in it's infancy in China so don't expect the government to step in.

'"Although Thai jasmine rice is highly favoured by Chinese consumers, its too-high price during the past few years has encouraged traders to mix it with other grains. This is to ensure that we [traders] get some profit from rice selling because, if the price is too expensive, traders will get a lower return," he [Shua Hong Bing, a rice wholesaler and retailer operating in Beijing and Shantou] said. Consumers prefer to buy cheaper rice even though they know the grains have been mixed, because the price of pure jasmine rice is too high for them when it comes to their daily staple, he added.

...

The combination ratio is generally 8:2 or 7:3, with the Thai jasmine rice blended with smaller amounts of cheaper grain.

...

Fang Yi Ming, a 73-year-old housewife, said her family had always favoured Thai jasmine rice since she was very young. However, with the rocketing price of Thai rice, she has had to adjust and now consumes mixed rice.
"I can hardly find pure 100-per-cent jasmine rice in the shops, as most of it has been mixed. Even in restaurants, they have turned to cooking mixed rice or using Vietnamese rice because it is cheaper while having a similar taste to Thai jasmine rice," she said'.

Ms Ming seems to possess more economic sense than the whole Thai government!  

Not only are Chinese consumers turning their backs on expensive jasmine rice, the Bangkok Post (Apr. 17) notes that farmers in the Isaan are changing the varieties they grow. With the for farmers profitable rice pledging, farmers are now looking at fast ways to cash in: shorter duration varieties with high yields.

Brooding

Research on economic returns of hybrid rice in U.S.A. points to economics on hybrid cultivation being sound: 

'Researchers Lawton Lanier Nalley, an associate professor of agricultural economics at the University of Arkansas at Fayetteville, and his research assistant Nathaniel Lyman concluded that hybrid rice cultivars are found to have significant yield advantages over the best-performing conventional alternative'.

This could well be the case in high management input systems with good information available and consumer ignorance ... 

However for Asia this is often not the case, management is poor, plot sizes small, inefficiencies elsewhere and at the end consumer preference lies elsewhere .. 

The American researchers conclude that hybrid rice growing has better economic returns in the state of Arkansas (Agro Professional, Apr. 19). That's if the price is not discounted .... Which it is.

GM rice / hybrid rice, still not enough rice is being produced according to agenda's for futurologists. Yuan Longping (of hybrid rice fame) will now have to search for super rice (China Daily, Apr 9): 

'China will launch a special scientific research project to develop a new super rice strain, expected to produce a bumper harvest of 14.9 metric tons a hectare, Minister of Agriculture Han Changfu said on Tuesday'.

Elsewhere Mr Longping has been promoting waterfalls of rice (Globalpost.com, Apr. 15) : 

'Ping likened these grains into cascades of water that stream toward a bounty, have potential yield of 13.5 tons per hectare'. 

Lots of flowery text to mask the hybrid source. The underlying thought is that science and technology will save us from oblivion. Not economical sense. Nor consumer power.

An odd article from Pakistan's Nation (Apr. 22): 

'Public sector institutes like Rice Research Institutes of Kala Shah Kaku and Dokri have failed to develop new successful and popular hybrid rice varieties during the last several decades of their existence.
As a result the basmati export is decreasing day by day'.  

But is this the case? 

'Experts said that massive electricity loadshedding and gas management has hit its business like never before. As per estimates, power loadshedding has reduced the milling capacity by 50 per cent. Gas management has been exceptionally delayed drying process. Both of them have very badly affected the entire chain — drying, husking and milling — up to 50 per cent, making it hard for them to meet export orders even when they have them.
Two other factors are high domestic prices and loss of Iranian market, which was the biggest for Pakistani rice.' 

Economics thus. Note that hybrids will do nothing to help exports ...

Competition

Myanmar's rise to prosperity through rice production. Assisted by Japan. Japandailypress (Apr. 15): 

'Japan is helping to boost Myanmar’s quest to regain its status as a top rice exporter by importing long-grain rice from the former military ruled Southeast Asian country for the first time in 45 years. Even more importantly, companies like Mitsui are investing in rice production to ensure the longevity of the industry. Myanmar Rice Industry Association Chairman Chit Khaing said that Japan is very enthusiastic about investing in the country’s rice industry'.

Vietnam is considering (Vientamnet, Apr. 18) more investment in plants which can produce parboiled rice, an interesting niche?

And more

IRRI's Bas Bouman has more (Apr. 30). A plead to follow in the steps of the EU?

'So, why did I dwell so much on this Mansholt Plan? Well, despite its controversial aspects and despite the differences in location and times, I see some striking similarities between a number of conditions besetting European farmers then and those besetting rice farmers in Asia today. Asia has about 120 million rice farms with average sizes of mostly 1 to 2 hectares only. Returns to rice cropping are low, with values of US$200–600/ha/season being most common. So, even with a farm size of 2 ha and two rice crops a year, income from rice farming is only $800–2,400/year. So, how can any family live off the income from rice farming? The fact is, they don’t, and most farming families have additional off-farm income. In recent years, labor migration from rural to urban areas has accelerated tremendously in many rice-growing areas of Asia. Since it’s usually the able-bodied young men who migrate, the remaining farming population is aging and “feminizing.” Already, women contribute at least half of the total labor inputs in rice production, and now they increasingly have to take on decision-making and management roles as well as doing tasks that were traditionally men’s work (e.g., land preparation, spraying of chemicals, and fertilizer application). Despite this labor outmigration over the last decades, farm size has kept on decreasing and the number of farms increasing. So, just as in the 1960s in Europe, we have to wonder about the future of farming in Asia—and then specifically in the rice sector. With so few prospects of earning a decent income, who will produce our rice in the (near) future?'

So female lead agriculture is not good? And small is not beautiful? 
Well, look at what Mansholt plan produced: huge reserves of untradable commodities. A bit like the Thai rice pledge scheme. 
Mechanization comes through changes in labor (opportunity) returns, not through government plans. Bigger farms through economic processes.

IRRI's Samarendu Mohanty has a good overview (Apr. 11) of the situation of rice prices in the near future. Three factors to account for. China's domestic price policies, Thai government willing to sell below price and the monsoon.