FAO predicts lower 2014 paddy production for third year running

The 2014 paddy season is at an advanced stage of progress, as the major producers in the Northern Hemisphere are now engaged in the harvesting of their main 2014 crops, with some also preparing the land for their 2014 secondary crops. Since the release of the Rice Market Monitor (RMM) in July, prospects for global paddy production have worsened substantially, mostly because of erratic weather conditions, including late arrival of rains or lingering droughts, which were often followed by heavy downpours and floods. These, together with a possible manifestation of an El Niño weather anomaly in the coming months, even if a weak intensity, have led to a lower forecast for global rice production in 2014 of 744.4 million tonnes (496.4 million tonnes, milled basis), about 6.5 million tonnes less than predicted in July. Under current expectations, global paddy production would be marginally (0.4 percent) lower than the 2013 estimate, marking a third year of below trend growth.


The disappointing 2014 season results would mostly be linked to the poor performance of crops in Asia, where production is now forecast to fall by close to 5 million tonnes, or 0.7 percent. If confirmed, this would be the first contraction (albeit modest) registered by the region since 2009.

Strong import demand, combined with ample supplies held by major exporting countries, is expected to boost world rice trade in 2014 by 7 percent to a 39.7 million tonne record. Imports are predicted to increase in all major geographical regions, especially Asia, where important buyers, such as Bangladesh, Indonesia, the Philippines and Sri Lanka, face the need to reconstitute reserves and to lower food inflation.

Despite the disappointing 2014 production outlooks, world rice trade in 2015 is currently forecast to be only 0.7 percent higher year-on-year, at about 40 million tonnes. Indeed, while the relatively poor results of the season would require several countries to step up imports in calendar 2015, part of the production shortfalls is likely to be filled by drawing supplies from national reserves.

FAO has lowered its forecast of world rice utilization in 2014/15 by 2.0 million tonnes to 500.3 million tonnes (milled basis). Nonetheless, the revised figure continues to suggest a 1.7 percent expansion in global rice utilization, largely on account of a 5.2 million tonne increase in world food use, which would support a small gain on a per caput basis to 57.5 kg in 2014/15. Quantities destined to seed, non-industrial uses and post-harvest losses are also set to rise.

FAO currently forecasts global rice carryovers in 2015 at 177.7 million tonnes (milled basis), which is some 2.0 million tonnes less than reported in the July issue of the RMM.

Following two months of steady gains, the FAO All Rice Price Index (2002-2004=100) rose by 1 percent in August to an average of 242 points, underpinned by seasonal tightness and strong import demand.

Get Our E-Newsletter - breaking news to your in-box twice a week
Will be used in accordance with our Privacy Policy
Share.

About The Author