Home Economy WFP Worries Over Global Rice Price…As Gov’t, Importers Agree On US$17 New Price

WFP Worries Over Global Rice Price…As Gov’t, Importers Agree On US$17 New Price

by newsmanager

ROME: The Chief Economist of the United Nations Food agency, World Food Programme (WFP), Arif Husain, said his entity is worried about the global rice prices that would impede the fight against hunger and poverty.

He said “Rice prices are up, and the World Food Programme (WFP), is worried.” At last U.N. General Assembly, the WFP Chief Economist, Arif Husain, discussed what he is watching when it comes to the global food crisis.
Husain tells newsmen in New York during the Assembly that the world has consistently missed opportunities to reform the food system when its weaknesses are exposed — such as happened in 2008 when rising rice prices contributed heavily to food insecurity, particularly in West Africa. Because the world remains so dependent on so few countries for key staple exports, a crisis in one country or region — say, Russia and Ukraine — causes ripples everywhere else.
“Our tendency is that as soon as the problem goes away, we go back to our usual business,” Husain said of the typical cycle of crisis response.
WFP chief economist: ‘We’re worried’ about rice prices.
Humanitarian access gains made in Tigray following a truce in the embattled region of Ethiopia have “evaporated” since fighting began again in August, according to Michael Dunford, regional director for eastern Africa at WFP.

He says during the five months after the truce, WFP brought 240,000 metric tons of aid into the region on over 8,000 trucks. The agency also moved 2.5 million liters of fuel into the region for its and other humanitarian organizations’ operations.
Now WFP can’t move trucks or fuel into the region and all current food distributions are from food brought in before the renewed fighting. This comes as an estimated 89% of the population — 5.2 million people — have limited food capacity, with over 40% of them acutely food insecure.

That’s the amount of global support needed to eradicate food insecurity, according to the International Monetary Fund.

They’re also out with a stark warning that the global food price shock is at least as bad as the devastating crisis of 2007-08 — and could worsen. My colleague Shabtai Gold reports that 48 vulnerable countries are seeing their import bills climb by about $9 billion over the next two years.
To help, the IMF board, on Friday, approved a new emergency financing window that enables countries to borrow funds to support balance-of-payment issues arising from the shocks, both on the import and export sides.

The new 12-month window will allow countries to borrow up to 50% of their IMF share quota — a measure of a country’s stake in the fund and relative economic size — to cope with higher food and fertilizer costs.
What’s at stake? In addition to an increase in deaths, high food insecurity has historically been associated with “social unrest, conflict, and large-scale migration,” the IMF writes.
“But unless we build a better food system, we’re never going to stop these crises from happening.”
WFP is of course not the only institution where economists are worriedly watching the global food crisis.

Lampietti and his colleague, World Bank Lead Agriculture Economist, Madhur Gautam, give Shabtai the insider view of the bank’s response to the situation. This includes strengthening safety nets, Lampietti tells Shabtai, as well as figuring out how to help farmers get more efficient at fertilizer application.
But, building a better food system requires focusing on resilience building, Lampietti says. This means helping countries see better ways to utilize subsidies — which for agriculture currently totals $640 billion — as well as supporting basics such as soil health.

At the same time, the full U.S. House of Representatives has passed the Global Food Security Reauthorization Act of 2022, which reauthorizes Feed the Future. Also the Asian Development Bank will provide at least $14 billion from 2022–2025 to ease a worsening food crisis in Asia and the Pacific.
Meanwhile, the Liberian Government, through the Ministry of Commerce and Industry (MOCI), said following consultations with leading stakeholders in the rice sector, it has reached an agreement with importers to stabilize the price of rice to US$17 for wholesale and US$17.50 for retail.
A statement issued by the Ministry of Commerce and Industry over the weekend pointed out that “since its inception, the CDC-led Government has managed to keep the price of rice on the local market a bit stable from USD16.50 per 25kgbag to $13.50.”
“However,” the statement added that “the past few months have witnessed some difficulties in keeping to the price that was negotiated by the Liberian Government with the country’s major rice importers.”
“This is due, meanly to global factors that appear to be beyond the control of Government as the GOL’s efforts to keep subsidizing the rice market seem to be affected by what is obtaining on the global market,” the statement further asserted.
The Ministry: “Liberia is about eleven months away to the 2023 General and Presidential Elections. Against this backdrop, the Government is under obligation to do everything it can to keep things stable.”
“As part of ongoing efforts by the Liberian Government, through the Ministry of Commerce and Industry (MoCI), to begin preparing the public to brace for what lies ahead of the country in terms of the rise in the price of the commodity, it has chosen to undertake a massive awareness across the country for a six-month period through the various channels of communication (radio, TV, social media and traditional) , ensure visibility of the work of the Ministry of Commerce and Industry and the Emergency Task Force ( Rice Committee) recently instituted by the Liberian Government to find solution to recent and unfavorable developments in the rice market.
The Government pointed that its efforts seek to set the necessary platform that softens the ground for the Liberian people to now begin looking forward to tangible future plans to graduate from rice importation to home-based production.
According to the Government, over the last five years, it has continuously worked with the importers of rice to ensure that the price remains affordable for the Liberian people and available on the local market.
As a result, of the current global challenges faced with sourcing of the commodity, President George Weah constituted a Rice Stabilization Taskforce, with the mandate to assess sustainability of current interventions, explore all options and propose new measures necessary to keep rice affordable and available on the Liberian market.
Following extensive consultations with all relevant stakeholders, including major rice importers and the Liberia Marketing Association, coupled with recommendations from the Rice Stabilization Taskforce, a decision was reached to adjust the price of rice in order to increase the importation volume; increase availability of the commodity on the market; eliminate unauthorized price hikes, and deter black market sales.
The GOL hereby announces effective Saturday, December 3, 2022, the following adjusted price for a 25kg bag of rice: Wholesale priceUS$`17.00 or LRD Equivalent; Retail price-$17.50 USD of LRD Equivalent.
“We want to assure the public that the current stock of rice in the country can sufficiently serve the market up to arrival of subsequent scheduled vessels. We therefore encourage businesses to continue to carry out unrestricted sale of rice, void of price hiking and profiteering at the expense of the ordinary people,” the Government disclosed.
The government said through the Ministry of Commerce inspectorate, it will ensure straight compliance with the decision and called on the public to report anyone found selling above the government regulated price, the statement concluded.

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