PHNOM PENH: International rice prices soared almost 10 percent from July to a 15-month high in August, the Food and Agriculture Organisation of the United Nations (FAO) said Friday.

But the FAO said overall food prices fell by more than two percent in the same period.

In a statement released in Rome, the UN agency said the FAO All Rice Price Index jumped 9.8 percent from July, “reflecting trade disruptions in the aftermath of a ban on Indica white rice exports by India, the world's largest rice exporter.

“Uncertainty about the ban's duration and concerns over export restrictions caused supply-chain actors to hold on to stocks, re-negotiate contracts, or stop making price offers, thereby limiting most trade to small volumes and previously concluded sales,” the statement said.

The overall FAO Food Price, however, fell 2.1 percent from July and was 24 percent below its peak in March last year.

UPGRADED FORECASTS INCLUDE CAMBODIA

The FAO meanwhile cut its forecast for rice output this season with downward revisions for Indonesia, Thailand, and China offset by upgrades for other countries including Cambodia.

The agency's Cereal Supply and Demand Brief — also released Friday — cut the forecast for 2023-24 by 500,000 tonnes to 523.2 million tonnes — but still 1.1 percent above last season.

“The revision primarily mirrors lower area estimates for Indonesia's April-concluded main-crop harvest as well as reduced expectations for Thailand, where main-crop plantings have lagged behind year-earlier levels due to irregular rains and reduced water supplies for irrigation,” it said.

“Excess rains and flooding in north-eastern provinces also reduced harvest expectations for China somewhat.

“These revisions were partly offset by forecast upgrades for various other countries, in particular Cambodia, Colombia, the Islamic Republic of Iran, Nigeria, and the United States of America, in all cases largely due to higher plantings than previously envisaged.”

World rice utilization for 2023-24 is now pegged at 520.9 million tonnes, up 800,000 tonnes from expectations in July and broadly stable year-on-year.

“Tighter overall supply outlook led to downgraded forecasts for a host of Asian and African countries,” the FAO said.

But the forecast was revised upwards for India. “Another comparatively large harvest on the backdrop of reduced exports could keep food intake above pre-pandemic levels for another season,” it said. At the same time, “volumes destined for ethanol production remain on an expansionary trend.”

World rice stocks have been revised downwards by 435,000 tonnes but are still expected to hit a record high of 198.1 million tonnes at the end of the 2034-24 marketing season — up 1.4 percent from a year earlier.

“As in previous seasons, nearly three-quarters of this volume is expected to be held by China and India, with India, in particular, envisaged to be behind much of the world's forecast stock expansion in 2023-24,” the agency said.

For international trade in rice, the FAO lowered its July forecasts by 600,000 tonnes for 2023 and by 3.0 million tonnes for 2023.

DURATION OF INDIAN RESTRICTIONS UNCLEAR

“Revisions largely follow the recent stepping up of rice export restrictions by India,” the FAO said.

Uncertainty over Indian restrictions reflects “leeway” for exceptions to be granted “on food security grounds and upon requests from governments, should they prove protracted.”

Indian curbs combined with El Niño-related constraints in Asian exporters could keep the expected recovery in world rice trade from fewer than 1.0 million tonnes to 53.3 million tonnes this year. AKP