Reporter Zhao Shifeng
As the world's second and third largest rice exporter, Vietnam and Thailand plan to jointly increase the price of exported rice. The two countries will hold talks between the Ministers of Agriculture from October 6 to 7 to discuss specific policies such as rice export prices. Vietnam and Thailand may increase rice export prices by about 20%. Against the backdrop of the ongoing conflict between Russia and Ukraine, the move will push up international food prices and intensify global inflation.
A woman sells rice in Hanoi, Vietnam. (Xinhua News Agency )
Thailand and Vietnam want to join forces to raise prices
Follow wheat and corn, rice will also face price increases. According to the report of " Nihon Keizai ", relevant Thai government sources revealed that the country's Minister of Agriculture and Cooperatives Cha Lengchai will visit Vietnam on October 6 and hold talks with Vietnam's Minister of Agriculture and Rural Development Li Minghuan to discuss agricultural cooperation matters, including exported rice prices.
Thai and Vietnamese governments discussed the issue of price increase in export rice in early September. Both sides agreed that in response to the increase in production costs caused by the rise in prices of fertilizers, pesticides and fuels, the two countries will set up working groups on export rice prices to formulate specific measures.
In the context of supply chain chaos caused by the COVID-19 pandemic and the conflict between Russia and Ukraine, international rice prices are rising. Thailand is the world's second largest rice exporter. According to the Thai government's forecast, the country's export volume this year has reached at least 8 million tons, a four-year high. Vietnam is the world's third largest exporter of rice. According to data from the US Department of Agriculture, Vietnam and Thailand account for about 10% of the global brown rice production, and about 26% of global exports. Thailand and Vietnam plan to jointly increase rice export prices this time, aiming to further increase the bargaining power of the two countries in the world agricultural product market.
Previously, India, the world's largest rice exporter, had begun to restrict some rice exports. The Indian government announced that it would ban the export of rice called "crumb rice" from September 9, and a 20% tax on the export of brown rice, semi-spice and refined rice. Indian officials pointed out that rice prices have been rising in recent months, with broken rice as feed rising to Rs 22 per kilogram from 16 rupees (about 1.4 yuan) in January this year. Some analysts pointed out that India's move is intended to curb domestic prices.
On April 18, farmers harvest wheat in a village in Amritsar, Punjab, India. (Xinhua News Agency)
India exports rice to more than 150 countries and regions in Asia, Africa and other places, accounting for 44% of the world's rice trade volume. Last year, India's rice exports reached a record 21.5 million tons. Since the beginning of this year, due to drought in some rice production areas, production is expected to decrease. A report released by the USDA in August showed that India's rice production could drop by 0.9% this year.
India has also launched export restrictions on wheat and sugar this year. The Indian Foreign Trade Administration issued an announcement on May 13, imposing a temporary ban on Indian wheat exports. On May 16, the main contract price of wheat on the Chicago Futures Exchange rose by 6%. India is the second largest and largest wheat producer in the world, but its export volume is very small, accounting for only 4.25% of the global export volume, and its direct impact on the global food trade pattern is limited. Nevertheless, the signals released by this move have increased concerns about international food trade.
India's temporary ban on wheat exports is based on multiple considerations: First, India's domestic inflation is high, and grain prices have risen significantly. Data released by the Central Bureau of Statistics of India recently showed that India's consumer price index (CPI) rose 7% year-on-year in August, of which the prices of grains and their products rose 9.57%. The rise in grain prices became the main driving factor for the rise in India's inflation. Secondly, due to the high temperature this year, wheat yield reduction and insufficient rainfall caused the shrinking rice planting area, the current prices of wheat, flour and rice in India are all showing an upward trend. Industry insiders predict that this situation may continue until the first quarter of next year. Again, the sharp rise in international food prices caused by the Russian-Ukrainian conflict is also one of the reasons why India temporarily bans wheat exports. An announcement from the Indian Foreign Trade Administration pointed out that rising international food prices have threatened the food security of India and neighboring countries.
In addition, India's agricultural fertilizers basically rely on imports, and Russia and Ukraine are the world's major fertilizer suppliers. After the outbreak of the Russian-Ukrainian conflict, international fertilizer prices also rose sharply, resulting in the Indian government having to increase its spending on fertilizer subsidies.
On August 3, the first grain transport ship "Lazoni" departed from the port of Odessa, Ukraine, passed through the Bosphorus Strait. (Xinhua News Agency)
Grain exports have not benefited poor countries
0 After Russia launched a special military operation on Ukraine on February 24, global wheat prices rose. Ukraine and Russia are both major food exporters, and Russia is also major fertilizer exporters. The Food and Agriculture Organization of the United Nations (FFAO) said that in the past three years, Russia and Ukraine have exported about 30% of the global total exports, and exported corn accounts for about 20% of the global total.
On July 22, Russia and Ukraine signed parallel agreements with United Nations and Türkiye respectively to resume the transportation of agricultural products from Black Sea ports. The Ukrainian Ministry of Infrastructure posted on social media on the 20th of this month that since the signing of the Black Sea port agricultural product transportation agreement, 177 grain transport ships have left the Ukrainian port and traveled to Asian, European and African countries, exporting a total of 4.1 million tons of agricultural products. The day before, Vesotsky, the first deputy minister of the Ministry of Agricultural Policy and Food of Ukraine, announced that Ukraine will harvest 67 million tons of grain this year, and Ukraine's domestic consumption is estimated to be 20 million to 22 million tons, so it can export at least 45 million tons of grain. Vysotsky said exports of new crops will begin in October this year.
On September 9, Russian President Putin said in his speech at the Federal Security Conference that Russia has exported 30 million tons of grain this year. If the harvest allows, Russia also plans to increase its export volume to 50 million tons, or even more. But Putin also stressed that the food exported from Ukraine is currently shipped to EU countries, and only 3% of it flows to the poorest countries. At the same time, only EU countries can purchase Russian fertilizers. Due to sanctions, Russia still cannot export fertilizers to Asia, Africa and Latin American countries through European ports. Putin also said that Russia intends to provide hundreds of thousands of tons of fertilizer stranded in European ports to the much-needed developing countries for free, and first consider providing potash fertilizer for free.
Joint Coordination Center for Black Sea Food Transportation was photographed on July 27 in Istanbul, Türkiye. (Xinhua News Agency)
The Joint Coordination Center that supervises the implementation of the Black Sea Food Transport Agreement announced on the 12th of this month that of grain transport ships departing from Ukraine, 44% of them sailed to high-income countries, 27% sailed to middle-income countries, and about 28% sailed to "low-income and lower-average countries."
Torrero, chief economist of the Food and Agriculture Organization of the United Nations, said recently that if the Ukrainian crisis continues, Russia and Ukraine may significantly reduce the export of wheat, corn, fertilizers and other products this year and next two years. The spokesperson for the United Nations World Food Programme pointed out that the current food crisis is unprecedented, and regional turmoil, climate change, the new crown epidemic and price increases are the four major incentives. According to , World Bank estimates, every 1 percentage point increase in food prices, 10 million people around the world will fall into extreme poverty.
The major grain exporter Russia has affected food exports due to sanctions, further aggravated the current food crisis. The U.S. Treasury Department issued a document in July this year claiming that Russia's agricultural products, agricultural equipment and medicines are not within the scope of US sanctions, and the U.S. supports efforts to alleviate global food shortages. However, Russian Foreign Minister Lavrov pointed out at the end of July that the United States' commitment to implementing relevant exemptions for Russia's food supply has not been fulfilled. UN Secretary-General Guterres html also called for the 6th to ensure that Russia's food and fertilizers enter the global market without hindering.
On August 3, UN Secretary-General Guterres attended the third report conference of the United Nations Global Food, Energy and Financial Crisis Response Group. (Xinhua News Agency)
"The mastermind behind" takes profit
At the moment when the world may face "the most severe humanitarian crisis since World War II ", several major American agricultural giants are making a fortune from the food crisis.A few countries such as the United States manipulate the global food trade system, build food hegemony, and repeatedly make huge profits in the food crisis.
According to Xinhua News Agency, an analysis article released by the School of Public Health of Johns Hopkins University in the United States pointed out that in the 1950s, under the promotion of the US government, American agriculture began to merge and integrate, and eventually achieved agricultural industrialization, and formed a number of large multinational enterprises, involving seeds, fertilizers, grain processing, grain trade and other aspects. Through these companies, the United States has locked in its voice in the global food system.
Currently, the four major giants that control the world's food trade, Aidi, Bangji, Cargill and Louis Dreyfus, are all American companies. American agricultural giant Monsanto controls a considerable portion of seed production. In a research report on the global food crisis around 2008, American scholar Holt Jimenez pointed out that in the fourth quarter of 2007, when the world food crisis occurred, AidiMeng's profit increased by 20%, Monsanto increased by 45%, and Cargill increased by 60%.
People receive aid supplies provided by the World Food Programme in Kandahar, Afghanistan. (Xinhua News Agency)
There are shadows of the United States behind all global food crises since World War II. Now, after the Ukrainian crisis escalates, the stock prices of AidiMeng and Bangji have risen sharply, and the stock prices of AidiMeng have risen by about 27% compared with the beginning of this year. The British " Guardian " reported in May that the price of commodities caused by the COVID-19 pandemic and the Ukrainian crisis has soared, and the wealth of billionaires in the food and energy fields has increased significantly in the past two years. Cargill currently has 12 family members becoming billionaires, while 8 people have been before the COVID-19 pandemic.
At the same time, people from all countries, including ordinary Americans, are suffering from rising prices. Data released by the U.S. Department of Labor on the 13th of this month showed that the U.S. consumer price index (CPI) in August rose 8.3% year-on-year, still at a 40-year high. Among them, food, housing and medical services closely related to people's lives pushed up CPI in August. A recent statistics from the National Energy Assistance Council show that about one in six households cannot pay their energy bills such as electricity and gas bills on time. Currently, the energy usage fees owed by US households are about $16 billion, double the amount two years ago.
Russian farmers sow spring wheat in a farm in Leningrad Prefecture. (Xinhua News Agency)
In addition to the low-income class, the middle class, which accounts for the majority of the United States' population, also feels "unbearable" by rising prices, and many people have to change their lifestyles. "The price is going crazy," said Palovsky, who works as a financial consultant in New York, and she spent nearly $400 to buy things in supermarkets, which used to cost only $250.
In order to curb inflation, the Federal Reserve Committee ( Federal Reserve ) has continuously strongly raised interest rates, abused the hegemony of the US dollar to export inflation, causing high prices in many countries and regions to depreciate currencies, and even face risks such as debt defaults. According to statistics, the annualized inflation rate of Egypt in July reached 13.6%; in the 12 months ended June this year, the national broad consumer price index of Brazil in China rose by 11.89%; the inflation rate of Nigeria in July reached 19.64%. The African Development Bank previously released the "2022 Africa Economic Outlook Report", which is expected that the average inflation rate in Africa will reach 13.5% this year.
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