International rice outlook for 1991/92 - world rice production will be down with largest declines in China and India; slight decline in world consumption predicted; east Asian production stays high as consumption falls; Latin American countries expected to be active in import market in 1992; rice projections mixed for Middle East, Africa, and European Community; foreign exporters to increase market share by 3% with largest gains expected in Thailand; U.S. exports will be down in 1990-91 marketing year - U.S. Dept. of Agriculture, Economic Research Service report

Situation and Outlook Report: Rice, July, 1991

World rice production in 1991/92 is forecast at 344 million tons (milled), down 1 percent from 1990/91, with the largest declines expected in China and India where record yields boosted supplies in 1990/91. World consumption is also projected down marginally. World trade in calendar 1992 is projected up 2 percent from 1991 to 12.9 million tons. Ending stocks and the stocks-to-use ratio are forecast down slightly. Asia, which accounts for over 90 percent of the world's rice, production and consumption, is projected to produce 316 million tons, down 2 percent from 1990/91, assuming normal weather. However, it is very early in the season. The monsoon rain in South Asia has just begun and planting for 1991/92 in several Southeast Asian countries, such as Thailand, Burma, and Vietnam, has not been completed. China, which usually produces one-third of the world's rice is projected to reduce area slightly and yields are projected to decline from the 1990/91 record. Production in 1991/92 is projected at 126 million tons, 3 percent below 1990/91. China has been experiencing a long-term decline in rice area as farmers move land into housing, rural industries, and more profitable crops. However, despite a record crop in 1990/91, which led to low farm prices, and inadequate storage for surplus grain, the government is exerting administrative pressure on farmers to keep area planted to rice. The continuing spread of hybrid seed technology is expected to keep yields high, but not match the 1990/91 record. India's 1991 monsoon rain began forcefully, favoring good rice production in the rain-fed eastern part of the country. However, the monsoon rains stalled before reaching the northwest where about 25 percent of India's rice is grown. Recently, intermittent rains and cooler temperatures have brought some relief. But, while most of this rice is irrigated, some is not and more rain will be needed to ensure full yield potential. In addition, severe foreign exchange constraints have restricted fertilizer imports, which might also contribute to a reduction in yield from the 1990/91 record. Production is forecast at 73 million tons, down 3 percent from 1990/91. Despite this production decline, India will be entering the new year with record carry-in stocks. As a result, India is expected to remain a net exporter in calendar 1992. The severe cyclone in Bangladesh will not have a major impact on 1991/92 rice production. About 300,000 tons of the 1990/91 rice crop was lost, but only a small percentage of the affected area had been planted to new crop rice. Rice production in 1991/92 is projected at 18 million tons, up slightly from 1990/91 due to increased yields. The cyclone damage and the resulting flooding, salinity, loss of inputs, animal traction, and manpower, is estimated to have led to a loss of 60,000 tons of new crop rice. Lower priced wheat, rather than rice imports, are forecast up in 1991/92 to meet the needs of cyclone victims. Rice consumption is projected down, with calendar 1992 rice imports projected to match 1991 at 100,000 tons. In the Philippines, rice production is forecast to rise 3 percent because of a projected increase in area as farmers respond to higher government procurement prices. However, recent dry weather in northern and central Luzon is creating some uncertainty about yields. Consumption is expected to outstrip domestic production and calendar 1992 imports are projected up 20 percent from 1991 at 300,000 tons. Most of the 1990/91 dry season crop had already been harvested when the volcano erupted. While up to 20,000 hectares of rice area have been affected, a total of 3.6 million hectares are projected to be harvested in 1991/92 and new crop production losses are expected to be minimal. Indonesia's 1991/92 production is projected at 29 million tons, down slightly from the 1990/91 record because of dry conditions in northern Java. Irrigation supplies appear adequate but some rain-fed area is being adversely affected. Imports are forecast down by a third at 200,000 tons as the government reduces its role in rice procurement, marketing, and storage.

East Asian Production Continues High as Consumption Falls

Japan's 1991/92 rice production is projected at 9.4 million tons, down slightly from the 1990/91 bumper crop. Producer prices have been declining since 1987, but farm prices remain well above the world rice price. Retail prices have also been reduced to slow the consumption decline, but consumption is falling faster than production, leaving ending stocks above the government's target of 900,000 tons. South Korea's 1991/92 production is projected up 2 percent to 5.7 million tons as high farm price supports encourage production despite burdensome stock levels. South Korea is seeking new food uses of rice and has begun donating small quantities of rice to North Korea. Taiwan's 1991/92 production is projected to decline marginally to 1.7 million tons as the rice land diversion program continues to move land out of rice production. Per capita consumption is falling at an even stronger pace than production and stocks remain high. To reduce stocks, Taiwan encourages the consumption of rice as feed and in processed food, and exports a growing percentage as donations.