Are We Going To Face Rice Crisis?

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What’s happening?

Food prices have been on the rise in the past few months.
And rice, a staple food in much of Asia, could be next, industry watchers said.
The prices of many foods, ranging from wheat and other grains to meat and oils, have shot up.
That’s been driven by a slew of factors, including the rising cost of fertilizer and energy in the past year as well as the Russia-Ukraine war.
Food export bans or serious disruptions have included those from India (wheat), Ukraine (wheat, oats and sugar, among others) and Indonesia (palm oil).
Rice could be next in line.
The United Nations’ Food and Agriculture Organization Food Price Index already shows international rice prices creeping up for the fifth straight month to reach a 12-month high, According to the latest May data published last week.

The southwest monsoon’s revival this month has resulted in the total area sown under kharif crops not only recovering,
But even surpassing last year’s coverage for the same period from June to mid-July.
However, paddy (rice) acreage, at 128.50 lakh hectares (lh) as of July 15, was 17.4% down from last year’s 155.53 lh.

On the face of it, not much, as government godowns had over 2 million tonnes (mt) of rice on July 1.
These were nearly three-and-a-half times the minimum level of stocks, to meet both “operational” (public distribution system) and “strategic reserve” (exigency) requirements for the quarter.
Rice stocks are still close to their peaks scaled last year.

That comfort doesn’t extend, though, to wheat – where public stocks have plunged from all-time highs to 14-year lows within the space of a year.
Inflation-haunted policymakers would dread the wheat story getting repeated in rice.
In wheat, it was a single bad crop — the one singed by the March-April 2022 heat wave — that did all the damage and brought down stocks to just above the minimum buffer.
In rice, the stakes are higher: It is India’s largest agricultural crop (accounting for over 40% of the total foodgrain output), With the country also being the world’s biggest exporter (a record 21.21 mt valued at $9.66 billion got shipped out during the fiscal ended March 2022).
Unlike with wheat, the options for import in rice — due to any production shortfall — are limited, when India’s own share in the global trade of the cereal is more than 40%.

Farmers first sow paddy seeds in nurseries, where they are raised into young plants.
These seedlings are then uprooted and replanted 25-35 days later in the main field that is usually 10 times the size of the nursery seed bed.
Nursery sowing generally happens before the monsoon rains.
Farmers wait for their arrival to undertake transplantation, which requires the field to be “puddled” or tilled in standing water.
For the first three weeks or so after transplanting, the water depth has to be maintained at 4-5 cm, in order to control weed growth in the early stage of the crop.
All this isn’t possible without the monsoon, which has overall been good this time.
The country has received 353.7 mm of rainfall during June 1 to July 17, 12.7% more than the “normal” historical average for this period.

Yet, a vast paddy-growing belt, from Uttar Pradesh to West Bengal, has had very little rains.
Cumulative rainfall has been 55.5% below the long period average in West UP, and 70%, 45.8%, 48.9% and 45.1% respectively for East UP, Bihar, Jharkhand and Gangetic West Bengal.
Deficient rainfall has meant that farmers in UP had transplanted only 26.98 lh under paddy until July 15, as against 35.29 lh during the same time last season.

Farmers in Bihar (from 8.77 lh to 6.06 lh), West Bengal (4.68 lh to 3.94 lh) and Jharkhand (2.93 lh to 1.02 lh) too have reported lower acreages.
So have those in Odisha, Chhattisgarh and eastern Madhya Pradesh, although that gap should reduce with the monsoon turning the corner in these parts.

Not for now. To start with, the India Meteorological Department has forecast that the current monsoon trough, which is active and south of its normal position, is “very likely to shift gradually northwards from Sunday”.
That should, hopefully, provide much-needed relief to farmers in the Gangetic plains within the next few days.
Secondly, paddy cultivation takes place across a wider geography, unlike wheat that is grown only in a few states north of the Vindhyas.
Also, rice is both a kharif (monsoon) and rabi (winter-spring) season crop.
So, the losses in one area or season can potentially be recouped from the other.
In wheat, everyone — from farmers and traders to policymakers — was caught off-guard by the sudden surge in temperatures after mid-March that cut grain yields by a fifth or more.
Rice is less likely to throw up huge negative surprises. And with the present stocks, it should be manageable.