Your rice plate just got costlier and you don’t even know it yet because the decision was taken far away in Thailand.

World prices for rice, a staple food in many countries across the globe, are set to rise with the world’s biggest rice exporter, Thailand set to boost the minimum price of unmilled rice in an attempt to keep its farmers happy. While the world would recognize this as a mere populist measure, the Thai government, oblivious to everything else, is hell bent to buy the unmilled rice directly from its farmers at 15,000 baht ($485) per ton instead of the current price of 10,000 baht.

Immediate Impact

Although, the immediate impact on the rice prices has been fearful, putting pressure on importer nations of rice, especially the poor ones, the long term effect on global consumers is still to be analyzed. It may be pertinent to mention here that during the July elections, the former premier Thaksin Shinawatra’s allies rode to victory with the help of an array of promises, one of which was this move.

About half of the world population, which is 3.5 billion people, eats rice as their staple food and Thailand accounts for one third of global rice exports. In fact, along with wheat and maize, rice makes up for two-thirds of total human food supply in the world. The major importers of rice in the world are China, Philippines, Bangladesh, South Africa, and Nigeria.

Price Rise of Rice 

The move to raise price of per ton of unmilled rice could raise the export price of rice to $ 800 per ton (which is higher than any other exporter) and, according to the Thai Rice Exporters Association, the country could well be on its way to lose its position as the biggest exporter of rice globally. An official associated with the Association said, “Any government in the world when they subsidize their commodities (do so) to be more competitive, but Thailand just did the opposite.”

USDA Prediction

From a 2011 record high, the global rice trade is expected to slump four percent. However the Thai exports, currently projected at 10 million tons this year, will further drop by a considerable 20% next year.

Warnings

The representatives of the export communities in Thailand and Vietnam, who met recently in the Thai city of Chiang Mai, warned that the rising prices on unmilled and export quality rice would have a direct impact on the consumer prices. According to a report by the Famine Early Warning Systems Network (affiliated to the USAID), the prices of rice in Asia have already been raised significantly in the past five months. This price hike is believed to have been driven mainly by the proposal of the Thai government.

Wait and Watch

While there is nothing you can do right now as a consumer, but for dinner today, may be you can just skip the rice.

Image Courtesy: ricenews.net, earthportals.com