Wheres the rice?

The price of rice has been rising around the world for the past several years. Many Economists think this trend will not stop for at least a decade. It is causing many countries in Southeast Asia to worry that many people will stop buying rice due to higher prices.

  So why is the price of rice rising? As it turns out there are several reasons. First off, the supply of rice is simply decreasing. Asia has been experiencing an unusual amount of floods lately and it is causing a shortage of rice supply in the world. This not only affects the supply of rice in several countries, but also in the Philippines – one of the leading producers of rice. As we have learned in class, when there is a shortage the price of a good increases, but this isn’t always a good thing for a country like The Philippines. Rice is one of the largest exports in that country so they depend on these exports to raise money and create jobs for their economy. However, they also rely on their own agriculture to feed their own people. Because of the recent shortages of rice, The Philippines had to stop exporting most of their rice so they could feed their citizens. Furthermore, they have lost so much of their rice crops that they even have to spend money to import rice back into their country. The lack of rice crops in their country is starting to take a toll on their economy.

In the early 18^th century Spain also experienced a shortage in rice crops. This however was not due to flooding. During 1835, there was a growing demand for sugar, indigo, tobacco and coffee. As a result, farmers stopped producing rice to produce these new hot commodities. In effect, because the farmers were no longer growing rice, there was now a shortage of rice in Spain! Dr. Onofre Corpuz, aruthor of Food security and Rice explains the following reasons why there was a rice shortage in Spain:

• A primitive rice culture, from land preparation to harvesting;
  
• A feudal system since the Spanish conquest. Families who owned small plots did not enjoy property rights;
  
• A religious culture that meant 100-120 days of "enforced idleness," since work was banned during Sundays, town feasts and church holidays; and
  
• Farmers or sharecroppers in haciendas (plantations) tilled small parcels of land yielding low output, thus preventing any savings. The farmers were always in debt, and the Spanish government had no assistance program for them.
  

So should there be a price control when there is a shortage? Corpuz wrote that the policies of price controls and rice imports were done to keep rice prices low "for the benefit of salaried government employees and the service population of Manila, and to keep the food costs of labor in the export agriculture and domestic manufacturing sectors low."

Another reason why rice has been so scarce is due to land conversion. The government has been encouraging farmers to use their land to plant cash crops instead of rice. Also, land owners are starting to turn their former rice fields into golf courses, residential allotments, and areas for new industrial factories- decreasing the amount of rice supplied. 

Rice is one of the main food products in Southeastern Asia. Taking away their rice production is like taking tea out of China! But they cannot blame weather for all of their rice losses; These countries need to not rely so much on their rice production and look at new ways to bring money to their country. Also, the government should have emergency strategies incase a shortage outbreak suddenly happens again.