The paddy is completely ready for harvesting. But farmers are still wondering whether to harvest or sow in the coming season, as rising prices of fuel and fertilizers due to the war in the Middle East have badly affected one of the world’s largest rice-growing regions. Across Southeast Asia, millions of small farmers are struggling to find affordable crop fertilizer as well as the diesel needed to run tractors, irrigation pumps and rice planters. In Thailand, some farmers are leaving the crop in the fields because it is too expensive to harvest.
The supply shortage highlights how the six-week war in Iran has disrupted global trade and raised concerns about food shortages. As well as rising oil prices, the near closure of the Strait of Hormuz, which remains largely blocked despite a temporary ceasefire, is disrupting a vital supply route for fertilizers and fuel, particularly affecting Asia.
Rice is the food of half the world
Patrick Davenport, director and co-founder of BRM Agro, a company that does rice farming and milling work in Cambodia, said in a Bloomberg report that many farmers are nervous. About three-quarters of the population in Cambodia lives in rural areas. He said that most of the people are involved in farming and they are all in trouble.
Rice is a staple food for more than half the world’s population, and a source of livelihood for rural communities in the region, where farming still forms a major part of economic activity. Farmers, who are struggling with doubling or tripling of input costs, are also facing the brunt of low prices. At least, this is the situation for now.
Benchmark prices of Thai white rice (5 percent broken) fell to a ten-year low in late October due to large amounts of rice accumulated in stockpiles. There has been very little improvement since then, with prices remaining below $400 a tonne for most of the last month.
Farmers are hesitant
Maximo Torero, chief economist at the U.N. Food and Agriculture Organization, said profits have been slashed, and that means they will plant less, Bloomberg reported. He also said that further closure of the Strait of Hormuz for 20 to 30 days may affect the availability of food in the second half of the year itself.
The problem of shortage of agricultural inputs can be solved only when ships start passing through this strait again. He said that I do not see any other solution. Davenport said some farmers in Cambodia are hesitant to move forward without a guaranteed return this month.
His company works with about 2,000 farmers. About one-tenth of the farmers have said that they will not sow unless they get a fixed price for the new crop.
Rice production may fall
Paddy-rice production in the Philippines, the world’s largest rice importer and also a major producer, could fall by at least 10 percent this year. This information is provided by Federation of Free Farmers Cooperatives Inc. National Manager Raul Montemayor gave this. Given the estimated national production of 20.3 million tonnes, this could mean a loss of about 2 million tonnes of rice. Montemayor said this is a huge possibility, and the impact of this shortage will be felt in the next harvest season in September or October.
The shortage of inputs (farming goods) for rice farmers in Southeast Asia has come at a time that could not have been worse. Many of these farmers grow two or more crops in a year and are currently going through a period between two seasons. Harvesting of dry season crops is currently underway, while sowing of the main wet season rice crops is beginning in Thailand and the Philippines.
Alisher Mirzabayev, senior scientist for policy analysis and climate change at the International Rice Research Institute, said that this is the time when fuel costs matter a lot. The cost of fertilizer will matter a lot. Availability will matter a lot. He further said that in terms of food security, we have the support of existing stocks — but we should not be careless.
Not much impact in China
Elsewhere in Asia, major sowing is still months away in India — a major producer — while China has been more insulated from shocks in energy and fertilizer prices. But in Vietnam’s Mekong Delta, where rice is grown three times a year, farmers are barely making ends meet when harvesting the main rice crop.
Pham Van Nhut, a 63-year-old farmer from the southern province of Vinh Long, told Bloomberg that due to rising production costs, some farmers are considering reducing the number of crops to just two.
Deep impact on Thailand
Meanwhile, some farmers in Thailand have decided not to harvest the now-ready rice crop or are delaying harvesting, leading to a decline in rice quality. According to a March 31 report by the Bangkok-based Kasikorn Research Center, the dry season crop in March-April may be about 19 percent less than the same period last year.
Sowing of this year’s main crop is going to start in a few weeks in Thailand. Pramot Charoensilp, president of the Thai Farmers Association, said that while it was unlikely that farmers would stop production completely, production would be limited by how much fertilizer could be purchased. This union represents thousands of farmers in most parts of the country.
started growing corn
These disruptions are expected to continue, so farmers are looking for new ways to reduce their dependence on imported fertilizers and fuel. Some farmers are starting to grow maize instead of rice, which requires less water than diesel-powered irrigation machines.
Cambodian company BRM is accelerating its plans to expand production of bio-organic fertilizers and is looking for suppliers of electric tractors and solar-powered water pumps to reduce fuel use. But options are limited for many others, whose livelihood depends on rice. They have no choice but to continue farming — even if it means incurring losses.
“We have no choice,” said Ruel Bantugan, a rice farmer from Bataan province in the Philippines. Instead of leaving the land vacant, we just have to try our luck and cultivate it again.