For two-thirds of the world’s population, rice is a commodity that they simply cannot live without. Notwithstanding the fact that it is not as nutritious as the cheaper substitutes like sweet potato, they simply have to have their steaming bowls or their day will not be complete. Moreover, should they fail to find rice stocked in store shelves, the consequence can be dire for the their government. Yes, people will fall in line for long hours, just to buy rice, at whatever price.

That is the simple story behind the commodity whose price within the last 12 months, rose more rapidly than petroleum’s.

Rice Situation:

Despite it being very important for most people, its production has taken a second row in the priority list of a number of countries. The introduction of higher valued crops and the rapidly growing population has compelled people to convert farmlands for residential, industrial and other purposes. As the population grew, the demand for land for other purposes like cattle farming and bio fuels for instance, also increased. With profit and immediate necessity influencing most decisions, people and governments converted rice lands in order to create more value and resolve immediate issues. Moreover, with some countries producing rice at costs cheaper than others do, there are those who simply opted to produce products that they can make more money from and simply import goods that they can acquired more cheaply. For the past several years, countries that do not produce sufficient rice have become dependent from major producers like Thailand, Vietnam and China.

Fatal Flaws

Relying on other countries for the supply of rice was based upon the assumption that the exporters will continue to produce the same volumes and continue to supply it, and at the same price. What the importing countries failed to realize is the fact that profit and immediate needs also necessitates their traditional suppliers to convert rice lands for other purposes. In addition, the under and over supply of rainwater and sunlight as well as pestilence are encountered by all countries from time to time. All of that contributed to the present decline in rice production. However, what is probably most fatal is the assumption that suppliers will continue to sell their excess production.

When harvests in some countries fell and speculators started playing with rice futures, governments like that of China, India, Vietnam and Egypt imposed export restrictions in order to assure their restless population and arrest the rising rice prices in their own markets. That is when the real rice shortage happened.

What started as a simple case of increasing demand and lower than expected harvests in some countries worsened when economic opportunism, social unrest and institutionalized hoarding came into play. This resulted to food riots in some countries and even a change of government in Haiti.

At this point, rice shortage is still a problem for some countries, especially for the Philippines, which requires about 2.2 million metric tons of imported rice for 2008. Looking at that country’s experience, it seems that the solution is still not that difficult to attain.

The rice shortage in the country can be best viewed using a simple supply and demand analysis.

Demand Analysis:

Population & Consumption. The Filipinos will consume 12.4 million tons of rice this year. Its rice eating population is estimated to reach 92 million (July 2008), a growth of 31.3 million from 1990. At this point, it produces only 90% of the rice demand and imports the remaining quantity from neighboring countries.

Population Growth. Had the country’s population attained only half of its growth rate from 1990, the country would not have been in deficit by this time. Going further back, some economists estimate that had the country’s population simply grown parallel to Thailand’s, it would have been in surplus by 2008. If the country aims to reach sufficiency, it needs to control its population growth. No amount of increase in harvest will be sufficient if the demand will keep on outpacing the supply.

Supply Situation:

Area and Irrigation. The Philippines has approximately 4.2 million hectares of rice lands and produce about 11.2 million Metric Tons (MT) of milled rice, sufficient only for 90% of the population. Out of the 4.2 million hectares, only 1.2 million are irrigated and therefore, about 71% of it has the potential to double its yield. Irrigating the lands is all that’s needed to wipe out the present shortage.

Certified and Hybrid Seeds. Going further, a study of farmers’ planting methods will show that about half of the country’s rice lands are still planted with the old rice varieties that produce only about 2.75 MT/hectare. The Philippines has so-called “Certified” and “Hybrid” seeds that yield 4.7 and 6.5 MT/hectare, respectively. The country’s supplier of hybrid seeds even claim that the actual average yield of his seeds is actually higher (8~10 MT/hectare) and there are even instances of exceptionally high yields that are reported b y some farmers.

Paradigm shift. Having grown to the old ways, most farmers refuse to use the new varieties and adapt better technologies. But just by looking at the figures mentioned, one will realize that a simple paradigm shift is all that is needed to increase the country’s harvest and attain rice sufficiency. Farmers only need to accept and adapt to change in order to increase their yields and increase their earnings.

Post harvest facilities, farm to marker roads, organic fertilizers, etc… In addition to the use of higher yielding seeds and the installation of more irrigation facilities, the country also needs to further fine tune its farming systems through the wider use of organic fertilizers, more efficient post harvest facilities and farm to market roads that will lower the farmers production cost.

Off shoring production. The use of better varieties, fertilizers, etc will come into naught if the weather decides to play with the farmlands, like what happened to Myanmar. In that country, a giant cyclone devastated the land and changed its status from being rice sufficient to a country in deficit. Following China’s model of buying/ leasing large tract of lands in Russia, Africa and South America and planting it with rice will ensure that the country will have alternative sources of rice (food) should calamity strike the country.

Residential farming. Even in the urban jungle, people can plant adequate amounts of food that will lessen their dependence upon farm produce. Bamboo can be cut lengthwise, hung and filled with enough soil for vegetable production; pots of soil can be planted with sweet potato, etc…

To sum it up, there are plenty of things that can be done to remedy the current rice shortage and the world’s current demand for more food. People are lucky that at this point, solutions can still be pulled from either the demand or the supply side. Let us not wait for the situation to get worse.

Now that the problem has been identified, it is time to move.