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Rice Article: Philippines

World's paddy rice production performs poorly for second year
By Josephine A. David
Business World Internet Edition, October 29, 2001

World production of paddy rice in 2000 dropped by 1.47% to 598.9 million tons from 607.8 million tons, data from the U.N. Food and Agriculture Organization (FAO) show.

The FAO recently forecasted a drop in global paddy production in 2001 to 587 million tons, after falling 16 million tons last season. The food body said that weather problems and low prices are behind those contractions, which mainly affected exporting countries. The forecast specifically affects Thailand and Vietnam, which are the two largest exporters of rice in the world.

Although there was a contraction in production in major exporting countries, international price of rice remained depressed, reflecting the weakness of import demand.

China is one of the countries to be severely hit by the contraction. The outlook for China's production in 2001 was down to 179 million tons, a 6% drop from the actual production of 190 million in 2000. The present year would be the fourth consecutive year that China would experience a continued contraction.

"Most of the year-to-year contraction stems from a sizeable reduction in the plantings of the early rice and semi-late rice crops, brought about by falling market prices in the previous two seasons and reduced government support," the U.N. food body said in a report.

The FAO recommends changes in policies that would create large potential impacts for the rice sector.

With the weakness in global import demand, FAO's latest forecast puts world trade in 2001 at 22.4 million tons (in milled equivalent) -- almost no growth at all from the production volume in 2000.

Rice imports to Asia were expected to fall in 2001, caused by the abundant harvest in traditional importing countries.

In 2000, the Association of Southeast Asian Nations (ASEAN) recorded a 1.14% expansion in paddy rice output despite the contraction in the whole world. The region contributed almost 25% of the total world output in 2000.

Among the ASEAN countries, the Philippines achieved the highest growth in paddy rice output of 5.33% to 12.4 million tons from 11.8 million tons in 1999. Last year was the second consecutive year that the Philippines led the ASEAN's growth in output.

The growth was attributed to the aggressive distribution of certified paddy rice seeds to farmers and the repair of inefficient irrigation systems. The Philippines posted a remarkable 37.8% improvement in 1999 after a 24.1% slump in paddy rice production in 1998 caused by unfavorable weather conditions.

Vietnam followed suit with a 3.7% expansion in paddy rice output to 32.6 million tons from 31.4 million tons in 1999. Vietnam contributed 5.4% to the aggregate world production of paddy rice in 2000. It is the second largest producer of paddy rice among Southeast Asian nations next to Indonesia.

Indonesia produces 8.5%, or 51 million tons of the world's paddy rice output. Indonesia managed to increase its paddy rice production by a measly 0.26%, a downtick from its 3.4% growth in 1999.

Lao People's Democratic Republic (Lao PDR) was the only country in the ASEAN region to report four consecutive years of growth from 1997-2000. Like the Philippines, the highest growth that Lao PDR achieved was in 1999 at 25.6%.

In 2000, growth stood at 2.5% to 2.16 million tons from 2.1 million tons.

The government's investment in irrigation helped augment production in rice fields.

Thailand, the largest exporter of rice in the world, posted a 0.4% expansion in paddy rice output from the previous year's 2.32% improvement. Excess flooding limited the production of paddy rice in the country.

Among the nine Southeast Asian countries reported, only Cambodia and Myanmar suffered contractions in their paddy rice output.

After five years of continued growth in rice production, Cambodia's output tapered off by 6.9% to 3.8 million tons from 4 million tons in 1999. The country was hit by seasonal flooding which damaged the crops. The floods in 2000 were described as the worst floods in at least four decades.

Meanwhile, Brunei Darussalam and Malaysia registered the same level of rice paddy production at 446 tons and 2 million tons, respectively.

Meanwhile, Brunei Darussalam and Malaysia registered the same level of rice paddy production at 446 tons and 2 million tons, respectively.

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