Indonesia May Export Most Rice in at Least 50 Years
Oct. 14 (Bloomberg) -- Indonesia, the world's fourth most populous country, may export as much as 2 million tons of rice in 2009, the most in at least 50 years, as production increases because of better seeds.
The country may grow about 40 million tons next year, consume about 36 million tons and increase stockpiles by 2 million tons, Agriculture Minister Anton Apriyantono said in an interview. Exports that high would be the most since at least 1960, according to U.S. Department of Agriculture figures.
Thailand and Vietnam, the biggest suppliers, have raised export forecasts this year after farmers planted more in response to higher prices. India will probably harvest a record crop, while the Philippines may cut imports next year. Prices of the staple for about 3 billion people tumbled 36 percent from a record $25.07 per 100 pounds on April 24 and may drop further.
"Prices will fall drastically'' if Indonesia ships 2 million tons Bhartendu Pandey, a trader at Bangkok-based Thai Maparn Trading Ltd., said by phone today. "Thailand will produce a lot of rice next year and Vietnam is out there now."
Indonesia would produce about 38 million tons this year and consume about 36 million tons, while government stockpiles stand at about 1.5 million tons, Apriyantono said in Jakarta yesterday. The export prediction depends on favorable weather, he said.
Safeguard Stockpiles
"It's most probable we can start exporting our rice'' next year if production targets are met, Apriyantono said. "We'll have to be very careful'' to safeguard our stockpiles, he said, estimating exports at 1 to 2 million tons.
The shipments would come as the government prepares to hold parliamentary and presidential elections in 2009. Almost half of the country's 243 million people depend on agriculture, forestry and fisheries for a living.
"The biggest challenge for us, as always, is the prosperity of our farmers,'' Apriyantono said. Rice is grown mostly by small farmers, yet the price cannot be ``that high'' for economic reasons, he said.
Oil palm growers or rubber farmers may have at least two hectares of land. For rice, the average in Java Island is only 0.3 hectares, so it's not easy for them to increase their income, he said. The number of farmers should decline and their role change to agribusiness or other sectors, he said.
Indonesia exported 472,000 tons of rice in 1992-93, the biggest annual amount since 1960, USDA figures show.
Regular Importer
By contrast, the country has been a steady importer in the past 50 years, including purchases of 5.8 million tons in 1997- 98 and 3.7 million tons the following year at the time of the Asian financial crisis.
The global credit freeze is having its biggest impact on export markets, not on domestic consumption, Apriyantono said.
"We expect to achieve self-sufficiency in corn this year," he said. Corn production increased 14 percent in 2007 and 12 percent in 2008 because area and productivity increased, boosting the possibility of exports, he said.
Corn output may climb to 14.9 million tons this year from 13.3 million tons in 2007, the Central Statistics Bureau said July 1. Soybean production may gain to 723,540 tons from 592,530 tons in 2007, it said.
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"The biggest challenge for us, as always, is the prosperity of our farmers"
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