global scenario of riceshodhganga.inflibnet.ac.in/bitstream/10603/26867/12/9...rice milled exports...
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CHAPTER-III
GLOBAL SCENARIO OF RICE
3.1. INTRODUCTION:
The world production of rice has increased at a faster rate than world
population over the last three decades despite the fact that rice is produced by
mainly small, marginal that too tenant farmers. Rice price at, world level has
shown a declining trend over last fifty years. But, in Asian countries, over the
years, the price of rice has increased with inter-year fluctuations and intra-
seasonality. Asian consumers depend more on rice for their dietary caloric intake
than consumers in other continents (Chand, 1998).
China is the world’s largest producer and the largest consumer of rice.
Thailand is the largest exporter of rice and Philippines is the largest importer of
rice in the world. In this chapter an analysis of growth trends in world rice prices
during 1994-95 to 2008-09 has been made. It is interesting to note that the annual
average growth rate in yield of rice during the 1980s to 1990s was 3.19 per cent
and it has declined to 1.34 per cent during the subsequent decade. However, it has
showed signs of marginal increase by 1.61 per cent during 2000-09. Looking to
the trends in compound annual growth rate, it revealed that in the decade of first
reform period i, e. from 1991-00, the compound annual growth rate was 1.87 per
cent and it has decreased to 0.64 per cent during 2001-10. The world price of rice
showed continues increasing trend from 1991-2010 and during 2005 to 2007, and
the world price of rice almost got doubled when compared to 1990-91 prices.
Rice milled exports from India has reached a high level during 1995 to 1998.
Again from 2001-09, it showed signs of increase. From1991to 1994 and from
1998-2001, a slackness in the rice milled exports was noticed. India started to
implement some limited policy reforms in the 1980s, and sharply accelerated the
reform process in the early 1990s. As a result of foreign trade liberalization,
exports of rice started increasing from the mid nineties. The tariff rates were
reduced sharply over the decade from a weighted average of 72.5per cent in 1991-
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92 to 24.6 in 1996-97, but rose again in the late nineties to 35.1per cent in 2001-
02. This may be due to lack of proper rice policies that resulted in imposing a
heavy burden on poor consumers necessitating the government to adopt food
distribution programmes. Keeping this in view a study has been under taken for
the period from 1990-91 to 2001-10 to see whether there was any systematic
relationship between the movement of production and rice price. In this context, it
is reasonable to examine the issue of strengthening linkages between the Indian
domestic market and world markets. It would therefore be interesting to see any
relationship between the movement of export and import, international prices on
impact of trade liberalization of rice sector. The present chapter has been divided
into four parts. The first part deals with recording of facts on the global rice
economy. The second part analyses the trend in rice consumption in major rice
growing countries and the third part examines the trends in rice production and the
factors contributing to the recent deceleration in the growth of rice production and
its impact on prices. Third part is devoted to the analysis of movement in value of
India’s rice exports. Fourth relates to analysis of movement in value of major rice
importing countries. Fifth the examination of competitiveness of rice milled
exports and direction of exports and imports. Sixth part examines impact of trade
liberalization export and import prices of rice and its trade flows. The last part is
devoted to suggesting perspective fruitful rice policies.
3.2. BACKGROUND OF THE STUDY:
3.2.I ANALYSIS OF THE RICE AND GLOBAL ECONOMY:
There exists a high degree of volatility in the world rice market because a
small change in production or consumption brings a relatively large change in its
total trade. Since most of the rice is produced, consumed and traded by Asian
countries and main Asian exporters are Thailand, Vietnam, India, Pakistan and
China. Now, the international trade under World Trade Organisation (WTO) rules
is free from quantitative restrictions. A country’s trade is mostly based on its
comparative and competitive advantage in international trade. So, obviously every
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country faces a tough competition in international market and tries not only to
maintain but also to increase its share in market (Ilyas.M, Tahir Mukhtar, 2007).
The world rice market is much conservative than other agricultural
commodities, which restricts its development. Competitiveness by any means is
not a new issue, as it seems now-a-days. This concept has become more
fashionable because the markets liberalisation and the emphasis in a more global
economy. Competition used to be more localized within regions and nations but,
now with an increasing international trade, it applies everywhere. Competitors are
not fully identified as they used to and now they might come from faraway place,
which was not the case previously.
This chapter examines the issues related to the decades of persistent
restrictions on both international and internal trade, India started to implement
some limited policy reforms in the 1980s, and sharply accelerated the reform
process in the early 1990s. As a result of foreign trade liberalization, exports of
rice started increasing from the mid nineties. Following the measures announced
in 1994 to liberalize international trade in rice, exports of almost all major
agricultural commodities have been liberalized (Kumar Parmod 2008). India also
liberalized its rice trade in late 1994, relaxing its ban on exports of ordinary rice
and allowing more private sector participation (Del Ninno and Dorosh 2001).
Once the free trade policy is implemented, trade barriers will be eliminated
and this will push domestic prices in rice producing countries to move closer to
international prices (Chand, 1998). Licensing arrangements have been relaxed,
tariffs have been reduced, many items have been freed from quantitative
restrictions, and the private sector has been permitted to import most food items.
The general trend has been towards lower tariffs, though domestic political
pressures have at times reversed this process. The tariff rates were reduced sharply
over the decade from a weighted average of 72.5per cent in 1991-92 to 24.6 in
1996-97, but rose again in the late nineties to 35.1per cent in 2001-02. In this
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context, it is reasonable to examine the issue of strengthened linkages between the
Indian domestic market and world markets.
The Indian rice market was opened up to international trade at the end of
1994 resulting in a quantum jump in exports. Rice is the staple food of the 70% of
the world’s poor living in Asia (Gulati and Narayanan 2002). The international
rice market is among the most distorted of commodity markets. It is frequently
characterized as thin, volatile and segmented (Gulati and Narayanan 2002).
Many countries, primarily in Asia, have strict limits on rice imports and exports,
and prices vary widely across countries. A the international rice market has
become so distorted because of the immense social and cultural importance
attached to rice, both as a staple crop essential for rural and urban food security in
Asia, and as a product of subsistence farming that ensures a livelihood for millions
of rural poor. One major outcome of these distortions is that very little rice is
traded and world prices, as a result, are quite volatile. Market interventions to
protect high-cost producers in the developed world, particularly the US and Japan,
further deform these markets.
This is consistent with the view that liberalizing rice exports has indeed
facilitated faster convergence of internal prices with international prices in rice
surplus states. Foreign trade liberalization is not symmetric in the way it deals with
exports and imports. Reflecting the dominance of producer interests in policy
formation, exporting has been made significantly more liberal than importing. This
would have implications for the spatial patterns of price convergence, with surplus
locations which are the likely exporters more likely to converge faster to
international prices.
Foreign exchange rate is an important factor affecting prices in global rice
trade because international rice prices are quoted in US dollars. Under normal
condition, if the local currency of a rice exporter is appreciating relative to the US
dollar, its rice export price (in US dollars) will increase which in turn will weaken
its competitiveness in the global rice market. On the other hand, if an importing
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country’s local currency is appreciating relative to the US dollar, its rice import
price (in US dollars) decreases which puts less burden on its local economy.
Nearly all rice imports are fragrant jasmine rice, primarily from Thailand.
Domestic production of fragrant rice is increasing, however displacing imports.
Unless there is a significant adverse weather event, China is not expected to fill its
rice tariff rate quota. In quota tariffs, 1 per cent for grains (including milled rice)
and no more than 10 percent for partially processed grain products. Over-quota
tariffs will be 76 per cent initially reduced to 65 per cent in 2004 (WTO 2001).
Vietnam has no significant production support policies or export subsidy
programme. Vietnam and the other major Asian rice exporters (China, India,
Pakistan and Thailand) have discussed the formation of a rice export cartel in
response to the low world prices for rice since 1999. India rejected the idea, but
the others are developing the concept. The Uruguay Round also forced Japan and
Korea to open their domestic rice markets, and this has led to more imports by
these countries. (On the other hand, Japan has also increased its exports of rice in
recent years, reducing the effect of the AoA on its net trade position.) Generally,
however, there are not many of these examples. In other words, Asia has
liberalized voluntarily it has not been dragged kicking and screaming into the
process (Landes and Gulati 2004).
But because the international rice trade was controlled by the government
during 2000-05, rice was not a tradable commodity (i.e. changes in world prices
did not lead to changes in domestic prices). Thus, while the exchange rate
depreciations increased the NPC, domestic farm prices in real terms were
relatively constant. Although India has officially banned non-basmati exports
since March 2008, it continues to ship its premium basmati rice and sells some
non-basmati rice to selected markets. Despite the expected increase in 2010,
India’s exports are just 35 per cent of its near-record shipments of 2007.
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The primary producers include India, China, Bangladesh, Thailand,
Indonesia, Vietnam, Myanmar, Philippines, Brazil, Pakistan, United States, and
Japan. The bulk of exports, about 80%, comes from just six countries—Thailand,
Vietnam, India, China, Pakistan, and the United States. Many countries are net
rice importers; but just a few countries where rice is the preferred staple account
for most imports—Indonesia, Philippines, Bangladesh, Malaysia, Japan, Korea,
and the Middle East. The international prices of rice and wheat, Asia’s key staple
foods, have been increasing since 2000. The export price of rice, the staple food of
more than 3 billion Asians, has risen steadily since the start of the new
millennium. The price of rice alone stood at $244/ton in 2004. It jumped to a high
of $764/ton in September 2008, slid down to $611/ton in January 2009, but never
returned to its 2004 level (FAO 2009).
The table-3.1 shows details percentage share of major rice producing
countries in the total world production of rice. India, China, Indonesia,
Bangladesh, Vietnam and Thailand have been the major producers of rice in the
world. Other countries account for a substantial amount of rice production,
Myanmar, Philippines, Brazil, Japan, USA and Pakistan. China accounted for
maximum share in the world production of rice between 1991 and 2010.
However, its share has shown an almost continuous decline during the two
decades from 35.80 per cent in 1991 to 29.50 per cent in 2010. Still it accounts for
the highest share in the world production during the entire period of 20 years.
India stood second in terms of its contribution to world production, India has
indicated a trend of fluctuations during the period of 2 decades from 1991 to
2010.
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Table-3.1 Percentage share of Major Rice Producing Countries in the Total World Production of Rice. Year India China Indonesia Bangladesh Viet Nam Thailand Myanmar Philippines Brazil Japan USA Pakistan 1991 21.60 35.80 8.62 5.25 3.78 3.93 2.55 1.86 1.83 2.31 1.39 0.94 1992 20.62 35.62 9.13 5.18 4.08 3.77 2.81 1.80 1.89 2.50 1.54 0.88 1993 22.67 33.85 9.07 5.07 4.30 3.68 3.16 1.78 1.90 1.84 1.33 1.13 1994 22.76 33.03 8.65 4.66 4.37 3.92 3.38 1.96 1.96 2.78 1.66 0.96 1995 21.09 34.21 9.09 4.82 4.56 4.02 3.28 1.93 2.05 2.45 1.44 1.09 1996 21.53 34.63 8.98 4.95 4.64 3.93 3.11 1.98 1.52 2.27 1.37 1.14 1997 21.44 35.14 8.56 4.88 4.77 4.09 2.89 1.95 1.45 2.17 1.44 1.13 1998 22.28 34.63 8.50 5.13 5.03 4.05 2.95 1.48 1.33 1.93 1.44 1.21 1999 22.01 32.80 8.33 5.64 5.14 3.96 3.29 1.93 1.92 1.88 1.53 1.27 2000 21.27 31.67 8.66 6.28 5.43 4.31 3.56 2.07 1.85 1.98 1.44 1.20 2001 23.38 29.97 8.43 6.06 5.37 4.43 3.66 2.17 1.70 1.89 1.63 0.97 2002 18.92 30.97 9.04 6.60 6.05 4.58 3.83 2.33 1.84 1.95 1.68 1.18 2003 22.71 27.76 8.92 6.56 5.91 4.62 3.96 2.31 1.77 1.67 1.55 1.24 2004 20.52 29.70 8.90 5.96 5.95 4.70 4.07 2.39 2.18 1.80 1.73 1.24 2005 21.70 28.70 8.54 6.27 5.65 4.77 4.36 2.30 2.08 1.79 1.59 1.31 2006 21.70 28.59 8.49 6.36 5.59 4.62 4.82 2.39 1.80 1.67 1.38 1.27 2007 22.01 28.53 8.70 6.56 5.47 4.89 4.79 2.47 1.68 1.66 1.37 1.27 2008 21.62 28.19 8.78 6.84 5.65 4.61 4.45 2.45 1.76 1.61 1.35 1.52 2009 19.34 29.06 9.49 6.64 5.73 4.64 4.82 2.40 1.86 1.56 1.47 1.52 2010 17.95 29.35 9.88 7.34 5.95 4.70 4.94 2.35 1.68 1.58 1.64 1.08
Source: Food and Agriculture Organisation (FAO), Rome. Note: Production thousand (tonnes) 1991-2010
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3.2. 2) TREND ANALYSIS OF RICE PRODUCING COUNTRIES DURING 1991-
2010
Table: 3.2 Production of Rice (Country wise) for the Periods from 1991-2010 Linear regression analysis
*p<0.05 Source: calculated by taking the values in table-3.1. The table-3.2 shows details, about the correlation between year of
production, and production is found to be positive and statistically significant in
Bangladesh, Viet Nam, Thailand, Myanmar, Philippines and Pakistan at 5% level
of significance(P<0.05). It means that as year advances with increase in
corresponding production during the year. But a significant and negative
correlation was observed between year of production in China and Japan
(P<0.05). Surprisingly, a non-significant correlation was seen between year of
production and production in India, Indonesia, Brazil and USA at 5% level of
significance (p>0.05).
Country Constant Coefficient t-value p-value R-square
India -2279108526 1.202 3.3636 0.0035* 0.3860
China 53590159 6.690 0.1651 0.8707 0.0015
Indonesia -1650507088 8.515 8.7593 0.0000* 0.8100
Bangladesh -2408203877 1.241 14.7398 0.0000* 0.9235
Viet Nam -2047276441 1.039 22.9156 0.0000* 0.9669
Thailand -1400358060 7.132 23.9690 0.0000* 0.9696
Myanmar -2063602661 1.038 15.5078 0.0000* 0.9304
Philippines -815109767 4.807 12.0926 0.0000* 0.8904
Brazil -293086726 1.578 3.1965 0.0050* 0.3621
Japan 268065730 -1.28 -3.0810 0.0064* 0.3453
USA -274008861 1.41 5.5862 0.0000* 0.6342
Pakistan -435289632 2.21 6.5902 0.0000* 0.7070
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Table-3.3 Compound Annual Growth Rate and Co-efficient of Variation for Major Rice Producing Countries
Countries/Year *CAGR #CV
1991-2000 2001-2010 1991-2000 2001-2010 India 1.87 0.64 0.32 0.83
China 0.99 1.61 0.39 0.32
Indonesia 1.23 3.03 0.32 0.51
Bangladesh 3.33 3.45 0.90 0.61
Viet Nam 5.55 2.07 1.09 0.40
Thailand 2.92 2.46 0.44 0.26
Myanmar 3.86 5.47 0.98 1.07
Philippines 2.15 2.88 0.87 0.37
Brazil 0.12 1.43 1.38 0.92
Japan -0.61 -0.22 1.40 0.78
USA 1.94 0.53 0.66 0.91
Pakistan 5.36 4.37 1.16 1.35
World 1.83 2.03 0.57 6.51
Source: calculated by taking the values in table-3.1. Note: *CAGR- Compound Annual Growth Rate, #CV- Co-efficient of Variation.
The table-3.3 shows details about Compound annual growth rate of rice
production in India which was at 1.87 per cent during the first decade from 1991
to 2010 and was higher compared to China’s which accounted for 1.61 per cent.
But the CAGR rice production in China was at 1.61 per cent in the second decade
India was higher than India. Indonesia’s share in world production of rice varied
from 8.62 per cent in 1991to 9.88 per cent in 2010. The production of rice in
Indonesia during the two decades has been largely sustained and indicates an
upward trend during the two decades. Indonesia’s CAGR in 1991-2010 decade
has been 1.23 which is above that of China’s (0.99). Its CAGR is much above
than that of India and China i, e. at 3.03 in 2001-10. Rice production in
Bangladesh had a sustained growth during the two decades. Her share in world
production of rice varies. There are marginal fluctuations in the production of rice
of Bangladesh which has been higher than India, China, and Indonesia at 3.3 per
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cent and 3.45 per cent during the two decades viz 1991-2000 and 2001-10
respectively. This is a significant trend in the rice production of this major rice
producing country. The share of rice production in Vietnam in the world
production of rice has varied at a lower level from 3.78 per cent in 1991 to 5.95
per cent in 2010. However, it is significant to note that the annual growth of rice
production has indicated a continuous rise during the two decades. The CAGR of
rice in Vietnam is the highest at 5.55 per cent in 1991-2000 compared to the
CAGR of all the rice producing countries. However, the CAGR was lower at 2.07
in 2001-10.
The share of rice production in world rice production in Thailand has
indicated a continuous rising trend during the two decades from 1991 to 2010. Its
CAGR’s in 1991-00 and in 2001-10 was 2.92 and 2.46 per cent respectively. They
are higher than the CAGR of India, China and Indonesia but lower than
Bangladesh in 1991-2000 and higher in 2001-10. A relatively lower share in the
world production of rice is accounted for by Myanmar during the period of two
decades between 1991 and 2010. Myanmar share in world rice production varied
from 2.55 per cent in 1991 to 4.94 per cent in 2010. However, it is noteworthy
that there is a trend of continuous rise in the share of rice production in the world
during the corresponding period of two decades. It is significant to find that the
CAGR of rice production of Myanmar is the highest at 5.47 per cent during 2001-
10 compared to other rice producing countries. The CAGR was the second highest
at 3.86 in 1991-00. The share of Philippines in the world production of rice is
much less compared to the other countries like India, China, Indonesia,
Bangladesh, Thailand and Myanmar. The share varied from 1.86 per cent in 1991
to 2.35 per cent in 2010. However, Philippines has been increasing its share in the
world production of rice continuously during the two decades. Its CAGR is more
than that of India and China in the Production of rice during the two decades. The
performance of Brazil is also not very significant in its share in world production
of rice.
Its CAGR is also low during the two decades compared to the other leading
rice producing countries. Japan’s share in world production of rice varied from
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2.31 per cent in 1991 to 1.58 per cent in 2010. Thus, it shows a declining trend of
its share in world rice production. The CAGR of rice production during the two
decades has been negative. USA’s share in world production of rice varied from
1.39 per cent in 1991 to 1.64 per cent in 2010. Its CAGR too is low. Pakistan’s
share in world production of rice varied from 0.94 per cent in 1991 to 1.08 per
cent in 2010. However, it is significant to note that it’s CAGR is very impressive
at 5.36 per cent in 1991-00 and 4.37 per cent in 2001-10.
However, coefficient of variance (CV) of rice production is calculated.
Indonesia, Vietnam, Thailand and Myanmar, Philippines, Brazil, Japan, USA,
Pakistan are major rice producing countries. Rice production trend among major
countries shows that production decreased by 0.32 per cent annually during 1991-
2000. But 0.83 per cent increase is found in the value of coefficient variation for
the period 2001-10. In absolute terms, China increased the production by from
0.39 per cent increased to 0.32 slightly accounting for the change during 1991-00
to 2001-10. Indonesian trend during 1991-00 was 0.32 per cent but increased to
0.51 per cent during 2001-10. In Bangladesh, Viet Nam it is found be 0.90 per
cent to 1.09 positive variation of value is found during 1991-00. But in same
countries during 2001-10 it is 0.61 per cent to 0.40 per cent. Thailand (0.44),
Myanmar (0.98), Philippines (0.87), Brazil (1.38), compared to other countries
like, Japan (1.40), USA (0.66), Pakistan (1.16) slight trend decline is seen during
1991-00. USA (0.91) and Pakistan (1.35) increased the production of rice,
coefficient value increased comparatively for other countries respectively.
3.2.3) SHARE OF MAJOR RICE PRODUCING COUNTRIES – YIELD PER HECTARE IN WORLD:
The table-3.4 shows details of the yield per hectare of rice in different major
producers of rice. Yield per hectare of rice in major rice producing countries has been
diverse and varied. Yield per hectare of rice in India is much lower compared to other
countries like china, Indonesia, Bangladesh, Viet Nam, Myanmar, Philippines, Japan and
USA. The yield per hectare in India is marginally higher compared to Thailand and
Brazil. The yield per hectare of rice in India varied from 74.31 per cent in 1991 to 74.64
per cent in 2010.
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Table-3.4 Yield Per Hectare of Rice in Major Rice Producing Countries (in qntls) Year India China Indonesia Bangladesh Viet Nam Thailand Myanmar Philippines Brazil Japan USA Pakistan 1991 74.31 159.08 122.95 75.22 88.06 63.74 81.64 79.89 65.12 165.73 181.72 65.62 1992 72.75 161.60 121.14 74.99 92.97 60.63 81.84 81.94 59.52 174.98 179.26 66.04 1993 78.08 161.29 120.70 75.00 96.05 59.87 84.29 79.29 63.21 126.31 170.39 75.58 1994 78.29 159.30 118.76 69.22 97.45 64.28 86.61 78.89 65.25 185.04 182.71 66.50 1995 73.70 164.53 118.84 72.49 100.83 66.02 81.34 76.63 70.14 173.34 172.19 75.21 1996 74.56 163.92 116.68 72.99 99.57 63.66 80.97 75.44 70.18 172.78 181.21 75.78 1997 74.53 165.29 116.08 71.84 101.53 62.30 80.63 76.81 71.52 168.04 173.12 73.46 1998 75.45 166.39 109.94 76.89 103.68 64.57 81.94 70.67 66.00 162.88 166.20 75.77 1999 76.44 162.58 109.13 82.49 105.28 62.22 83.17 75.63 78.81 164.63 168.74 78.91 2000 73.27 161.01 113.11 89.54 109.06 67.16 86.97 78.86 77.98 172.27 180.95 77.91 2001 79.18 156.34 111.50 86.45 108.90 66.57 86.85 80.98 82.35 168.62 185.02 69.99 2002 67.98 160.71 116.12 90.68 119.27 67.78 88.78 85.21 86.36 171.02 191.57 78.45 2003 79.21 153.98 115.41 90.87 117.85 67.39 90.08 85.61 82.54 148.62 189.93 75.08 2004 73.70 156.26 112.37 87.58 120.26 70.74 93.85 87.02 88.10 158.90 194.02 74.10 2005 77.07 152.80 111.77 92.40 119.47 72.40 91.62 87.67 82.33 162.47 181.43 77.57 2006 77.15 152.47 112.24 93.63 118.90 70.84 92.29 89.51 94.25 153.92 187.82 76.78 2007 78.43 152.49 111.72 95.26 118.41 71.44 91.07 90.25 90.85 154.60 192.13 78.79 2008 78.24 152.22 113.65 92.76 121.27 68.79 86.36 87.54 98.24 157.39 178.16 81.73 2009 70.80 156.74 118.89 93.22 124.34 68.26 88.47 85.36 103.82 155.13 188.88 85.18 2010 74.64 149.72 114.65 95.63 121.68 65.74 94.29 82.82 95.42 148.87 172.34 69.95
Source: Food and Agriculture Organisation (FAO), Rome. Note: Yield in Acre / Ha,
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Table: 3.5 Yield Per Hectare of Rice (Country wise) for the Periods from
1991-2010 Linear regression analysis Country Constant Coefficient t-value p-value R-square
India -597212 -3.00
5.7455 0.0000* 0.6471
China -699618 3.80
6.7895 0.0000* 0.7192
Indonesia -613401 3.20
6.4701 0.0000* 0.6993
Bangladesh -17737009.030
16.7801 0.0000* 0.9399
Viet Nam -22710621.157
44.2504 0.0000* 0.9909
Thailand -866981 4.460
13.1678 0.0000* 0.9060
Myanmar -11438605.89
13.9515 0.0000* 0.9154
Philippines -1116120-5.74
9.5372 0.0000* 0.8348
Brazil -22626111.10
18.8476 0.0000* 0.9518
Japan -623933 3.40
1.9525 0.0666 0.1748
USA -18131839.42
8.9783 0.0000* 0.8175
Pakistan -967610 4.98
7.7496 0.0000* 0.7694
*p<0.05 Source: calculated by taking the values in table-3.4.
Trend analysis of yield per hectare during 1991-2010:
The table-3.5 shows details correlation between year of yield per hectare
and yield per hectare is found to be positive and statistically significant in
Bangladesh, Viet Nam, Thailand, Myanmar, Philippines, Brazil and Pakistan at
5% level of significance(P<0.05). But a significant and negative correlation was
observed between year of yield per hectare and yield per hectare in China and
Indonesia (P<0.05). Surprisingly, a non-significant correlation was seen between
year of yield per hectare and yield per hectare in India, Japan and USA at 5%
level of significance (p>0.05). The trend lines of yield per hectare during 1991-
2010 are presented in the above table.
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Table-3.6 Compound Annual Growth Rate and Co-efficient of Variation for Yield Per hectare of rice in major producing countries
Countries/Year *CAGR #CV
1991-2000 2001-2010 1991-2000 2001-2010 India 1.08 1.24 0.42 0.69
China 1.39 0.89 0.44 0.29
Indonesia -0.10 1.51 0.17 0.48
Bangladesh 2.67 2.22 1.04 0.69
Viet Nam 3.17 2.17 0.94 0.66
Thailand 1.69 1.34 0.58 0.53
Myanmar 1.33 1.57 0.48 0.57
Philippines 0.31 1.59 0.34 0.58
Brazil 3.67 3.62 1.21 1.16
Japan 1.69 0.30 1.01 0.39
USA 0.71 0.67 0.40 0.35
Pakistan 3.06 2.03 0.98 0.82
World 1.14 1.31 0.35 0.46
Source: calculated by taking the values in table-3.4. Note: *CAGR- Compound Annual Growth Rate, #CV- Co-efficient of Variation.
The table-3.6 shows details of CAGR of yield per hectare which was 1.08 per cent
in 1991-00 and 1.24 per cent during 2001-10. The yield per hectare in China was very
high at 159.08 per cent in 1991 and 149.72 per cent in 2010. There is a trend of decline
in China’s yield per hectare of rice since 2001 onwards. The CAGR of China relating to
yield per hectare of rice was 1.39 in 1991-00 and 0.89 per cent in 2001-10. Indonesia
provides another example of declining trend of yield per hectare of rice during the two
decades from 1991 to 2010. The yield varied from 75.22 in 1991 to 95.63 per cent in
2010. The CAGR is the second highest at 2.67 in 1991-00 and 2.22 in 2001-10 next only
to Viet Nam.
The performance of Viet Nam in terms of yield per hectare of rice has been quiet
encouraging. The yield varied from 88.06 in 1991 to 121.68 in 2010. The yield has
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shown a trend of continuous rise with minor slowdown during the two decades. Its
CAGR was higher at 3.17 in 1991-00 and 2.17 per cent in 2001-10. Thailand’s
performance in terms of yield per hectare of rice during the two decades has been
fluctuating. It varied from 63.74 per cent in 1991 to 65.74 per cent in 2010. The CAGR
of yield per hectare of rice too are lower at 1.69 per cent in 1991-00 and 1.34 in 2001-10.
Thus Thailand’s performance in the direction of yield per hectare of rice and the CAGR
are highly discouraging compared to all other countries reviewed here. The performance
of Myanmar in this direction is slightly better than, Thailand and India, the yield varied
from 81.64 in 1991 to 94.29 per cent 1991-00 and 1.57 in 2001-10. The yield per hectare
of rice in Philippines varied from 79.89 per cent in 1991 to 82.82 per cent in 2010.
However, the yield has not been uniform during the two decades. The CAGR in the yield
per hectare of rice has been lowest at 0.31 per cent in 1991-00. The CAGR of yield per
hectare of rice has been very encouraging. It was 3.67 per cent in 1991-00 and 3.62 per
cent 2001-10. The CAGR of Brazil’s rice yield is the highest compared to all other
countries covered by the study.
Japan’s performance in terms of yield per hectare is much better compared to other
countries except USA. It varied from 165.73 per cent in 1991 to 148.87 per cent in 2010.
However, the CAGR of rice yield of Japan has been low at 1.69 in 1991-00 and 0.30 in
2001-10. Performance of USA has been better than all other countries overall by the
study in terms of yield per hectare of rice during the two decades from 1991 to 2010. It
varied from 181.72 per cent in 1991 to 172.34 per cent in 2010. However, it CAGR has
been very low with 0.71 per cent in 1991-00 and 0.67 per cent in 2001-10. Pakistan’s
performance in terms of yield per hectare of rice has been low compared to majority of
the countries covered by the study varied from 65.62 per cent in 1991 to 69.95 per cent
in 2010. Its CAGR has been very encouraging with 3.06 per cent in 1991-00 and 2.03 per
cent in 2001-10.
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The value in co-efficient of variation for 1991-2010 decade for India, China,
Indonesia, Bangladesh, Viet Nam, Thailand, Myanmar, Philippines, Brazil, Japan, and
USA, Pakistan. The value of C.V for India is significantly good 0.94 per cent accounted
for like China 0.44 per cent and Viet Nam 0.94 highest yield during 1991-00. Other
countries Bangladesh C.V is 1.04 per cent, Brazil 1.21 per cent the value of C.V slightly
changed during 1991-2000. India accounted for 0.69 per cent to 0.29 per cent declined
yield per hectare during 2000-10. Bangladesh’s C.V was 0.69 per cent and Vietnams
0.66 per cent, Philippines 0.58, Pakistan 6.82 per cent, Vietnam’s coefficient positively
yield per hectare rice production increased respectively for the year 2001-10. Brazils
share was 1.16 per cent and U.S.A’s was 0.35 per cent during 2001-10 to Myanmar 0.48
per cent value of coefficient during 1991-00. India’s CAGR is 1.08 per cent but value of
C.V is 0.69, yield per hectare declined during 1991-00. CAGR accounted for 1.24 per
cent to C.V 0.29 per cent and Pakistan recorded growth rate of 3.06 per cent to 0.98
during 1991-00 and 2001-10.
3.2. 4) SHARE OF MAJOR RICE PRODUCING COUNTRIES – AREA PER HECTARE IN THE WORLD:
The table-3.7 shows details of the share in major rice production in the world in
terms of area per hectare. India ranks first among the countries covered by the study in
terms of the area per hectare in rice production. Its area per hectare for rice production in
the world varied from 29.07 per cent in 1991 to 24.05 per cent in 2010.
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Table-3.7 Area under Rice cultivation as Percentage of total World’s Cultivated Area of Rice Year India China Indonesia Bangladesh Viet Nam Thailand Myanmar Philippines Brazil Japan USA Pakistan 1991 29.07 22.50 7.01 6.98 4.30 6.17 3.12 2.33 2.81 1.40 0.77 1.43 1992 28.35 22.04 7.53 6.91 4.39 6.22 3.43 2.20 3.18 1.43 0.86 1.34 1993 29.04 20.99 7.52 6.76 4.48 6.14 3.75 2.24 3.01 1.46 0.78 1.49 1994 29.07 20.73 7.29 6.73 4.48 6.09 3.90 2.48 3.00 1.50 0.91 1.44 1995 28.61 20.79 7.65 6.65 4.52 6.09 4.03 2.51 2.92 1.42 0.84 1.45 1996 28.88 21.13 7.70 6.79 4.66 6.17 3.84 2.63 2.16 1.32 0.76 1.50 1997 28.77 21.26 7.37 6.79 4.70 6.56 3.58 2.54 2.02 1.29 0.83 1.53 1998 29.53 20.81 7.73 6.67 4.85 6.27 3.60 2.09 2.02 1.19 0.87 1.60 1999 28.80 20.18 7.63 6.83 4.88 6.36 3.96 2.55 2.43 1.14 0.91 1.60 2000 29.02 19.67 7.66 7.01 4.98 6.42 4.09 2.62 2.37 1.15 0.80 1.54 2001 29.53 19.17 7.56 7.01 4.93 6.66 4.22 2.67 2.07 1.12 0.88 1.39 2002 27.83 19.27 7.79 7.28 5.07 6.75 4.31 2.73 2.13 1.14 0.88 1.50 2003 28.68 18.03 7.73 7.22 5.02 6.86 4.40 2.70 2.14 1.12 0.82 1.66 2004 27.84 19.01 7.92 6.81 4.95 6.64 4.34 2.74 2.48 1.13 0.89 1.67 2005 28.16 18.78 7.64 6.79 4.73 6.60 4.76 2.63 2.53 1.10 0.88 1.69 2006 28.13 18.75 7.57 6.79 4.70 6.53 5.23 2.67 1.91 1.08 0.73 1.66 2007 28.07 18.71 7.79 6.88 4.62 6.84 5.26 2.74 1.85 1.07 0.71 1.61 2008 27.63 18.52 7.73 7.37 4.66 6.71 5.15 2.80 1.79 1.02 0.76 1.86 2009 27.32 18.54 7.98 7.12 4.61 6.79 4.96 2.81 1.79 1.01 0.78 1.79 2010 24.05 19.60 8.62 7.68 4.89 7.15 5.24 2.83 1.76 1.06 0.95 1.54
Source: Food and Agriculture Organisation, Rome. Note: Acre in / Ha.
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Table: 3.8 Area Under rice Cultivation (Country wise) for the Periods from 1991-
2010 Linear regression analysis Country Constant Coefficient t-value p-value R-square India 125345918.35 -4.10 -0.5774 0.5708 0.0182
China 389482735 -1.72 -3.9336 0.0010* 0.4623
Indonesia -188714789 1.06 7.5347 0.0000* 0.7593
Bangladesh -144181601 7.71 6.0051 0.0000* 0.6670
Viet Nam -100322670 5.37 4.9732 0.0001* 0.5788
Thailand -199465381 1.04 13.9341 0.0000* 0.9152
Myanmar -354952833 1.80 11.8865 0.0000* 0.8870
Philippines -112261840 5.80 7.5422 0.0000* 0.7596
Brazil 165310189 -8.08 -5.0128 0.0001* 0.5826
Japan 63285408 -3.07 -9.3978 0.0000* 0.8307
USA -5907442 3.55 0.9158 0.3719 0.0445
Pakistan -66319427 3.43 5.4125 0.0000* 0.6194
*p<0.05 Source: calculated by taking the values in table-3.7.
Trend analysis of area harvested during 1991-2010:
The table-3.8 shows details, the correlation between year of area harvested and
area harvested is found to be positive and statistically significant in Indonesia,
Bangladesh, Viet Nam, Thailand, Myanmar, Philippines and Pakistan at 5 per cent level
of significance(P<0.05). But a significant and negative correlation was observed between
year of area harvested and area harvested in India, China, Brazil, and Japan (P<0.05). It
means that as year advances with decrease in corresponding area harvested during the
year. Surprisingly, a non-significant correlation was seen between year of area harvested
and area harvested in USA at 5 per cent level of significance (p>0.05).
\
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Table-3.9 Compound Annual Growth Rate and Co-efficient of Variation for Area Under rice cultivation as percentage of total worlds cultivated area of rice
Countries/Year *CAGR #CV
1991-2000 2001-2010 1991-2000 2001-2010 India 0.78 -0.59 0.26 0.54
China -0.40 0.72 0.28 0.32
Indonesia 1.34 0.09 0.46 0.50
Bangladesh 0.65 1.20 0.30 0.50
Viet Nam 2.31 -0.10 0.70 0.13
Thailand 1.21 1.11 0.43 0.37
Myanmar 2.50 3.42 0.94 1.12
Philippines 1.83 1.26 0.92 0.44
Brazil -3.42 -2.11 1.70 1.37
Japan -2.26 -0.52 1.00 0.42
USA 1.22 -0.14 0.67 0.97
Pakistan 2.23 2.29 0.55 0.83
World 0.69 0.60 0.23 0.28
Source: calculated by taking the values in table-3.4. Note: *CAGR- Compound Annual Growth Rate, #CV- Co-efficient of Variation.
The table-3.9 shows details, CAGR in this context was poor at 0.78 per
cent in 1991-00 and -0.59 in 2001-10. Next to India, China had a better average
whose area per hectare of rice production in the world varied from 23.50 per cent
in 1991 to 19.60 per cent in 2010. Its CAGR too has been low at -0.40 in 1991-00
and 0.72 per cent in 2001-10. Indonesia accounts for the third rank in terms of
area per hectare in rice production in the world. The area per hectare varied from
7.01 per cent in 1991 to 8.62 per cent in 2010. Its CAGR was better at 1.34 per
cent in 1991-00 and 0.09 in 2001-10. Bangladesh has steadily increased its share
from 6.89 per cent in 1991 to 7.68 per cent in 2010 with a CAGR of 0.65 per cent
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in 1991-00 and 1.20 per cent in 2001-10. The share of rice producing area per
hectare in the world for Viet Nam varied from 4.30 in 1991 to 4.89 in 2010. Its
CAGR in 1991-00 was good at 2.31 but was negative at -0.10 in 2001-
10.Thailand has a better position with its share of area per hectare at 6.17 per cent
in 1991 and 7.15 per cent in 2010. Its CAGR in 1991-00 was 1.21 and in 2001-10
was 1.11 per cent. Myanmar ranks lower in this direction with its area per hectare
of rice production at 3.12 per cent in 1991 and 5.24 per cent in 2010. The increase
trend of area per hectare in the rice production is significant. Its CAGR was 2.50
per cent in 1991-00 and 3.42 per cent in 2001-10. This is the highest CAGR of all
others countries covered by the study. Philippines has a lower rank in terms of
rice producing area per hectare in the world at 2.33 per cent in 1991 and 2.83 in
2010. There is a very slow increase in the area during the two decades. The
CAGR was 1.83 per cent in 1991-00 and 1.26 per cent in 2001-10. Brazil has
experienced a declining trend in the rice production area per hectare in the world
during the two decades. It slumped from 2.81 per cent in 1991 to 1.76 per cent in
2010. Its CAGR has been negative at -3.42 per cent in 1991-00 and -2.11 in 2001-
10. Japan provides a still poor picture in this direction with its share in terms of
area per hectare in rice production in the world at 1.40 per cent in 1991 and 1.06
per cent in 2010. Its CAGR has been negative at -2.26 in 1991-00 and -0.52 in
2001-10. USA’s share in terms of area per hectare in rice production in the world
has stagnated at a low level. It varied from 0.77 per cent in 1991 to 0.95 per cent
in 2010. Its CAGR was 1.22 in 1991-00 and negative at -0.14 in 2001-10.
Pakistan has also stagnated in terms of area per hectare of rice production in the
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world during the two decades from 1991 to 2010. It varied from 1.43 per cent in
1991 to 1.54 per cent in 2010. It’s CAGR to 1.54 per cent in 2010. Its CAGR was
good at 2.23 in 1991-00 and 2.29 in 2001-10.
However, value of co-efficient area under rice cultivation of as percentage
of total world’s cultivated area of rice. Indian value of coefficient is less i, e., 0.26
per cent compared i., e. to China 0.28 per cent during 1991-00 and 2001-10.
Indonesia accounted for 0.46per cent to 0.50 per cent and Bangladesh 0.30 per
cent to 0.50 per cent of value of coefficient increase of area during 2001-10. But
Viet Nam accounted for in 0.70 per cent 1991-00 to 0.13 per cent decline during
the recent year 2001-10. Myanmar accounted for 0.94 per cent to 1.12 per cent
and Japan 1.00 per cent to C.V 0.42 per cent, decline area did not change during
1991-00 to 2001-10. CAGR of India is -0.59 per cent compared to Japan i. e., -
0.52, U.S.A accounted for -0.14 per cent negative area decline during 1991-00.
But value of co-efficient got positively changed during 2001-10.
3.2.5) SHARE OF MAJOR RICE CONSUMPTION COUNTRIES – CONSUMPTION:
The table-3.10 shows details share of rice consumption in the total
production in major rice producing countries is very high, rice is consumed
domestically in all the major rice producing countries in the world. Consumption
of rice in India accounted for more than 90 per cent of the total production during
the decades from 1991 to 2009. Consumption ranged from 99.39 per cent in 1991
to 98.38 per cent in 2009. Similarly in China the share of rice consumption in its
total production varied from 99.56 per cent in 1991 to 99.68 per cent in 2009. In
Indonesia the consumption of rice varied between 99.29 per cent in 1993 to 100
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per cent in 2009. Consumption of rice in Bangladesh accounted for 100 per cent
of production in 1991 and 99.99 per cent in 2009. In Viet Nam consumption of
rice varied from a minimum of 85.35 per cent in 2005 and a maximum of 94.74
per cent in 1991 during the two decades from 1991 to 2009. Thailand provides a
picture comparative, lower percentage of rice consumption in relation to total
production consumption of rice varied between a minimum of 72.60 per cent of
production in 2008 to a maximum of 94.74 per cent in 1991 during the two
decades. Consumption of rice has been high in relation to production in Myanmar.
It varies from 98.03 per cent to 99.87 per cent high percentage of consumption of
rice in relation to production is found in case. In Philippines consumption of rice
in relation to production varied between a minimum of 99.63 per cent and a
maximum of 100 per cent during the two decades from 1991 to 2009. In Brazil
consumption of rice in relation to production varied from 97.23 per cent to 99.99
per cent during two decades consumption of rice in USA has been lower in
relation to production compared to other countries. It varied from a minimum of
73.08 per cent to a maximum of 85.16 per cent during the corresponding period.
In Pakistan consumption of rice in relation to production has been still lower
compared to USA and other countries. It ranged from a minimum of 54.78 per
cent to a maximum 82.78 per cent during the two decades from 1991 to 2009.
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Table-3.10 Percentage share of major rice consumption countries in the total world consumption of rice Year/ Avg India China Indonesia Bangladesh Viet Nam Thailand Myanmar Philippines Brazil USA Pakistan 1991 99.39 99.56 100.00 100.00 94.74 82.45 98.72 99.90 99.99 77.98 75.24 1992 99.47 99.45 99.91 100.00 90.99 76.50 98.66 99.63 99.97 79.52 67.66 1993 99.36 99.19 99.29 100.00 92.46 77.79 98.43 100.00 99.89 73.08 82.78 1994 99.27 99.46 99.66 100.00 91.57 79.79 94.87 100.00 99.99 77.74 80.96 1995 95.76 99.87 100.00 100.00 92.04 74.87 98.03 100.00 99.98 71.25 68.87 1996 97.95 99.87 100.00 100.00 88.62 78.78 99.48 100.00 99.99 77.05 75.21 1997 98.12 99.53 100.00 100.00 87.01 80.01 99.83 100.00 99.99 82.32 72.81 1998 96.21 98.16 100.00 100.00 87.20 75.52 99.29 100.00 99.94 82.71 71.88 1999 98.63 98.67 100.00 100.00 85.64 76.18 99.73 100.00 99.81 84.18 76.84 2000 98.80 98.48 100.00 100.00 89.31 79.56 98.82 100.00 99.88 84.30 72.01 2001 98.47 98.93 100.00 100.00 88.38 75.93 95.72 100.00 99.84 85.16 58.37 2002 95.39 98.89 100.00 100.00 90.59 76.96 96.36 100.00 99.87 82.60 74.93 2003 97.46 98.49 100.00 100.00 88.97 74.12 98.32 100.00 99.93 79.05 74.97 2004 96.26 99.57 100.00 100.00 88.76 69.81 99.26 100.00 99.96 84.11 75.82 2005 97.22 99.69 99.92 99.99 85.35 80.05 99.35 100.00 99.76 77.43 65.25 2006 96.81 99.41 100.00 99.98 87.05 79.77 99.77 99.99 99.50 77.92 54.78 2007 95.75 99.38 100.00 99.98 87.32 76.92 98.86 100.00 99.49 81.18 62.50 2008 98.33 99.58 100.00 99.99 87.77 72.60 99.87 99.99 97.35 81.54 75.07 2009 98.38 99.68 100.00 99.99 91.23 78.06 99.87 100.00 97.23 82.90 75.61
Source: Food and Agriculture Organisation, Rome.
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3.2.6. COMBINED INFLUENCE OF PRODUCTION AND CONSUMER PRICE, PRODUCER PRICE ON CONSUMPTION OF RICE:
Table-3.11 Multiple Regression Analysis of Consumption of Rice
India Indpt variables Coefficients t Stat P-value R-square Intercept 96.6176 28.8082 0.0000
0.31 Production 0.0100 0.7432 0.4681 Consumer price -0.0313 -2.6193 0.0186 Producer price 0.0076 1.7132 0.1060 China Indpt variables Coefficients t Stat P-value R-square Intercept 98.8723 44.5681 0.0000
0.10 Production 0.01500 0.1894 0.8522 Consumer price -0.0064 -0.9356 0.3634 Producer price 0.0025 1.2529 0.2282 Indonesia Indpt variables Coefficients t Stat P-value R-square Intercept 100.1950 144.7415 0.0000
0.14 Production 0.200 -0.5118 0.6158 Consumer price 0.1600 1.1680 0.2599 Producer price -0.0001 -0.0649 0.9491 Bangladesh Indpt variables Coefficients t Stat P-value R-square Intercept 100.0083 7117.5165 0.0000
0.53 Production 0.0300 0.8038 0.4333 Consumer price -0.0002 -1.6787 0.1126 Producer price 0.0000 -0.5624 0.5817 Thailand Indpt variables Coefficients t Stat P-value R-square Intercept 80.9894 16.1752 0.0000
0.09 Production 0.0100 0.0202 0.9841 Consumer price -0.0517 -0.4140 0.6844 Producer price 0.0058 0.4296 0.6732 Philippines Indpt variables Coefficients t Stat P-value R-square Intercept 99.8841 687.5053 0.0000
0.15 Production 0.0200 -0.3620 0.7221 Consumer price 0.0015 0.8240 0.4221 Producer price 0.0002 0.5102 0.6169 Pakistan Indpt variables Coefficients t Stat P-value R-square Intercept 67.5106 7.7474 0.0000
0.23 Production 0.0100 1.5486 0.1410 Consumer price -0.1726 -2.1156 0.0504 Producer price -0.0131 -0.2200 0.8286
*p<0.05 Source: computed from the data given in faostat.com table-3.10
The table-3.11 provides multiple linear regression equation predicting the
consumption of rice (Y) of India in terms of production (X1), consumer price (X2) and
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producer price (X3) was found to be lower: Consumption of rice of India (Y) =
96.6176+0.0000X1-0.0313X2+0.0076X3. The multiple R of the linear regression
equation is 0.5622 and coefficient of multiple determination of R2 is 0.3161. The
multiple linear regression equation predicting the consumption of rice (Y) of China in
terms of production (X1), consumer price (X2) and producer price (X3) was found to be
under: Consumption of rice of China is (Y) = 98.8723+0.0000X1-0.0064X2+0.0025X3.
The multiple R of the linear regression equation is 0.3248 and coefficient of multiple
determination of R2 is 0.1055. The multiple linear regression equation predicting the
consumption of rice (Y) of Indonesia in terms of production (X1), consumer price (X2)
and producer price (X3) was found to be under: Consumption of rice of Indonesia is (Y)
= 100.1950+0.0000X1+0.0016X2-0.0001X3. The multiple R of the linear regression
equation is 0.3756 and coefficient of multiple determination of R2 is 0.1411. The
multiple linear regression equation predicting the consumption of rice (Y) of Bangladesh
in terms of production (X1), consumer price (X2) and producer price (X3) was found to
be under: Consumption of rice of Bangladesh is calculated as (Y) =
100.0083+0.0000X1-0.0002X2+0.0000X3. The multiple R of the linear regression
equation is 0.7338 and coefficient of multiple determination of R2 is 0.5384. The
multiple linear regression equation predicting the consumption of rice (Y) of Thailand in
terms of production (X1), consumer price (X2) and producer price (X3) was found to be
under: Consumption of rice of Thailand (Y) = 80.9894+0.0000X1-0.0517X2+0.0058X3.
The multiple R of the linear regression equation is 0.3053 and coefficient of multiple
determination of R2 is 0.0932. The multiple linear regression equation predicting the
consumption of rice (Y) of Philippines in terms of production (X1), consumer price (X2)
and producer price (X3) was found to be under: Consumption of rice of Philippines is
(Y) = 99.8841+0.0000X1+0.0015X2+0.0002X3. The multiple R of the linear regression
equation is 0.3908 and coefficient of multiple determination of R2 is 0.1527. The
multiple linear regression equation predicting the consumption of rice (Y) of Pakistan in
terms of production (X1), consumer price (X2) and producer price (X3) was found to be
under: Consumption of rice of Pakistan is calculated (Y) = 67.5106+0.0000X1+-
0.1726X2-0.0131X3. The multiple R of the linear regression equation is 0.4812 and
coefficient of multiple determination of R2 is 0.2315.
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3.3. ANALYSIS OF INDIA’S RICE EXPORTS:
The ear of globalization since the late 1940s has dramatically changed the
world’s trading patterns, as well as the measures employed by countries to
survive in a world where trade is being liberalized. Asia is the home of many of
the world’s top rice exporters, which accounts for 76 per cent of rice exported
each year. Prices are shooting up worldwide in part because many of these
countries have cut back on exports due to fears of shortage. International trade
in rice is quite small relative to total production. In fact, only 6 to 7 per cent of
global rice production is traded each year, well below the trade shares for other
grains factors. The reasons for these market characteristics could be explained by
several factors. Firstly, rice is largely produced in Asia countries, where rice is
traditionally the major food source for nutrition. Secondly, besides being a major
producing region, Asian countries are major importers of rice. Because of
national security concerns, rice production and trade are highly protected and
sensitive.
The details in table No.3.12 indicate some significant trends about export‐
production relationship of rice in different regions. Exports production ratio
indicates the level of export intensity in relation to the total production of the
export commodity from a country. High percentage of export to total production
indicates lower percentage of domestic consumption of the commodity and rice
versa. Rice is one of the staple food products produced and exported by a host of
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Asian and North‐America countries. Among the major exporters of rice Pakistan
occupies a predominant position as its exports of rice in relation to production
are the highest compared to the other countries. Exports of rice from Pakistan
varied from a minimum of 17.22 per cent in 1993 to a maximum of 45.22 per
cent in 2006 in relation to its total production of rice. Thus, exports constitute an
important component in foreign trade of Pakistan. USA and Thailand occupy the
next important place as exporters of rice. USA’s exports of rice during the first 6
years i.e., from 1991 to 1996 were higher than export of rice from Thailand.
However, the latter accounts for much higher percentage of rice exports in total
production compared to USA in later period. Vietnam happens to be the fourth
important exporter of rice in relation to its domestic production followed by
India. Rice exports from India in relation to its total production have indicated a
declining trend since 1995. While exports of rice as percentage total production
from Vietnam indicate a rising trend during the later period i.e., from 1996
onwards. Myanmar and China have been exporting rice on a moderate scale and
their share of exports in their domestic production is not substantial. Similarly
exports of rice from Brazil have been marginal as they constitute less than 1 per
cent of its total domestic production exports from Indonesia and Bangladesh is
negligible.
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Table‐3.12 Share of rice exports as percentage of total rice production in respective counties (Percentage)
Year
India China Indonesia Bangladesh Viet Nam Thailand Myanmar Philippines Brazil USA Pakistan
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in
Prod
Percentage
Share of
Exports in
Prod
1991 6.05 0.44 0.00 0.00 5.26 17.55 1.28 0.10 0.01 22.02 24.76
1992 5.32 0.55 0.09 0.00 9.01 23.50 1.34 0.37 0.03 20.48 32.34
1993 6.38 0.81 0.71 0.00 7.54 22.21 1.57 0.00 0.11 26.92 17.22
1994 7.26 0.54 0.34 0.00 8.43 20.21 5.13 0.00 0.01 22.26 19.04
1995 4.24 0.13 0.00 0.00 7.96 25.13 1.97 0.00 0.02 28.75 31.13
1996 2.05 0.13 0.00 0.00 11.38 21.22 0.52 0.00 0.01 22.95 24.79
1997 1.88 0.47 0.00 0.00 12.99 19.99 0.17 0.00 0.01 17.68 27.19
1998 3.79 1.84 0.00 0.00 12.80 24.48 0.71 0.00 0.06 17.29 28.12
1999 1.37 1.33 0.00 0.00 14.36 23.82 0.27 0.00 0.19 15.82 23.16
2000 1.20 1.52 0.00 0.00 10.69 20.44 1.18 0.00 0.12 15.70 27.99
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2001 1.53 1.07 0.00 0.00 11.62 24.07 4.28 0.00 0.16 14.84 41.63
2002 4.61 1.11 0.00 0.00 9.41 23.04 3.64 0.00 0.13 17.40 25.07
2003 2.54 1.51 0.00 0.00 11.03 25.88 1.68 0.00 0.07 20.95 25.03
2004 3.74 0.43 0.00 0.00 11.24 30.19 0.74 0.00 0.04 15.89 24.18
2005 2.78 0.31 0.08 0.01 14.65 19.95 0.65 0.00 0.24 22.57 34.75
2006 3.19 0.59 0.00 0.02 12.95 20.23 0.23 0.01 0.50 22.08 45.22
2007 4.25 0.62 0.00 0.02 12.68 23.08 1.14 0.00 0.51 18.82 37.50
2008 1.67 0.42 0.00 0.01 12.23 27.40 0.13 0.01 2.65 18.46 24.93
2009 1.62 0.32 0.00 0.01 8.77 21.94 0.13 0.00 2.77 17.10 24.39
Source: Calculated from www.fao.org Note: Production (000’ tones) 1961‐2009, Export in Quantity in 000’ tones 1961‐2008
Japan Not Available in Export Data – Rice Milled Data
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3.3.1) MOVEMENT IN VALUE OF RICE EXPORTS:
Table‐3.13 Provides the details of share of rice milled in major exporting
countries in world exports (Value in US$ million). Major countries in terms of
compound annual growth rate (CAGR) the share in rice milled exports in the
world export in terms of value are Philippines, Indonesia, Bangladesh and
Myanmar. The average CAGR of exports value of these countries ranged
between a minimum of 11.76 of Myanmar and a maximum of 24.29 of
Philippines during 1991‐00. Other countries with substantial CAGR of exports
were China, India and Vietnam. The coefficient of variation value rice export in
value terms of India was the highest at 45.23 followed by Indonesia 22.57,
Philippines 13.68 and Bangladesh 10.20 during 2001‐09. The CV during 2001‐09
of other countries viz., China 3.11, Vietnam 6.00, Thailand 5.90, USA 4.59 and
Pakistan 5.50 were at a lower side. Share in world export and India’s exports of
milled rice in terms of value have been higher since 1995 onwards. They varied
between 7.79 and 24.10 during the two decades from 1991 and 2009. China’s
exports have been comparatively lower varying between 0.87 and 11.42 per cent
exports of milled rice in terms of value from Indonesia and Bangladesh have
been negative or marginal during the corresponding period. Vietnam’s exports
have picked up since 1996 till 2009 and averaged at 15.29 during 1991‐00, and
17.58 during 2001‐09. Thailand’s exports of milled rice in value terms are the
highest during the entire period i.e., from 1991 to 2009. Exports in terms of value
of milled rice have been marginal during the same period Exports of milled rice in
value terms from USA and Pakistan have been substantial during the two
decades.
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Table‐3.13 SHARE OF RICE EXPORTING COUNTRY AS PERCENTAGE OF TOTAL WORLD EXPORTS OF RICE (Percentage)
Year India China Indonesia Bangladesh Viet Nam Thailand Myanmar Philippines Brazil USA Pakistan
1991 8.80 5.16 0.00 0.00 6.66 29.78 1.06 0.07 0.03 16.20 9.80
1992 8.33 5.21 0.19 0.00 9.39 29.82 0.92 0.19 0.04 13.54 9.27
1993 9.82 6.10 1.34 0.00 8.66 28.14 1.03 0.00 0.12 14.12 7.64
1994 7.79 5.70 0.52 0.00 8.58 28.84 4.22 0.00 0.01 15.37 4.88
1995 22.22 0.87 0.00 0.00 8.34 28.08 1.22 0.00 0.02 11.86 7.28
1996 14.20 1.43 0.00 0.00 13.69 28.87 0.33 0.00 0.01 11.51 8.24
1997 14.06 3.91 0.00 0.00 13.61 30.02 0.09 0.00 0.01 9.68 7.50
1998 19.12 11.42 0.00 0.00 13.07 24.37 0.34 0.00 0.04 7.61 7.28
1999 11.17 9.65 0.00 0.00 15.97 26.50 0.16 0.00 0.14 8.67 9.21
2000 12.16 9.85 0.00 0.01 12.41 27.47 0.60 0.00 0.08 9.02 9.93
2001 13.90 6.37 0.01 0.01 12.48 27.35 2.23 0.00 0.09 8.88 10.41
2002 21.89 6.42 0.00 0.00 13.21 25.49 1.74 0.00 0.07 8.18 8.38
2003 15.50 7.84 0.00 0.00 12.56 27.40 0.96 0.00 0.05 9.92 9.80
2004 19.65 2.46 0.00 0.00 12.89 32.13 0.43 0.00 0.03 9.36 8.51
2005 17.11 2.20 0.11 0.03 17.64 24.59 0.47 0.00 0.12 10.12 11.67
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2006 17.06 3.90 0.01 0.03 14.58 25.17 0.20 0.00 0.20 9.05 13.14
2007 24.20 3.36 0.00 0.02 12.98 25.38 0.79 0.00 0.19 7.19 9.79
2008 15.49 2.26 0.00 0.03 17.41 32.21 0.14 0.00 1.32 7.29 9.66
2009 15.66 2.47 0.01 0.01 11.00 29.32 0.16 0.00 1.30 9.67 12.02
2010 11.79 2.15 0.00 0.02 16.68 27.23 0.22 0.00 0.81 12.09 11.06
Source: Calculated from www.fao.org. Note: Export in Value (million dollars $) 1961‐2008, *Japan is Not Available in Export Data – Rice Milled Data *
CAGR (Compound Annual Growth Rate), #CV (Co‐efficient Variation) Note: (Value in million dollars)
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Table‐3.14 Compound Annual Growth Rate And Co‐Efficient Of Variation For Rice Exporting
Country As Percentage Of Total World Exports Of Rice
Countries/Year
*CAGR #CV
1991‐2000 2001‐2010 1991‐2000 2001‐2010
India 12.75 14.73 5.64 4.28
China 14.91 2.90 7.73 2.71
Indonesia ‐58.98 12.17 20.35 20.65
Bangladesh 36.45 40.40 17.02 8.35
Viet Nam 15.29 18.98 4.48 6.04
Thailand 5.02 17.74 1.99 5.42
Myanmar ‐14.31 ‐11.65 11.76 6.48
Philippines ‐30.13 85.83 24.29 13.51
Brazil 14.11 70.31 10.59 14.04
USA ‐1.62 18.05 1.45 6.08
Pakistan 7.19 19.52 2.57 5.39
Source: calculated by taking the values in table‐3.4.
Note: *CAGR‐ Compound Annual Growth Rate, #CV‐ Co‐efficient of Variation.
ANALYSIS OF RICE EXPORT THROUGH GROWTH RATE AND CO‐EFFICIENT OF
VARIATION IN VALUE:
Table‐3.14 provides the details of imports of milled rice share of imports
in world imports (in value). It is important to note from Table‐ 3.14 that India is
not an importer of rice even if it imports, it imports only marginal quantity’s of
rice. The value of imports of milled rice by Sri Lanka was lower which varied
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between 0.01 and 1.20 during 1991 to 2009. Benin’s imports value ranged
between 0.23 and 1.91 during the same period imports value of milled rice by
Saudi Arabia varied between 3.98 in 1992 and 9.79 in 2009. Oman, Kuwait and
Syrian Republic have been marginal importers of milled rice. Imports of milled
rice by Malaysia varied between 1.72 and 4.17. UAE’s imports value of milled rice
varied between 1.39 and 6.99 during the two decades i.e., from 1991‐2009.
Canada’s imports of milled rice were lower and varied between 1.35 and 1.98
during the corresponding period. Imports value of Cote d’ Ivoire varied between
1.09 and 3.76 per cent. Oman has led other countries in terms of value of
coefficient of variation of share of rice milled imports in the world imports with
92.31 during 2001‐09 followed by UAE with 88.91, Malaysia 78.64, Sri Lanka
77.67, Kuwait 63.91, Benin 59.99, Cote d’ Ivore 57.59, Saudi Arabia 56.83, Syrian
Arab Republic 52.21, and Canada 40.33.
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Table‐3.15 SHARE OF RICE IMPORTING COUNTRY AS PERCENTAGE OF TOTAL IMPORTING OF RICE (Percentage)
Year Sri
Lanka Benin
Saudi
Arabia Oman Kuwait Malaysia UAE Canada
Côte
d’Ivoire
Syrian Arab
Republic World
1991 0.71 1.05 4.33 1.08 0.43 2.74 3.77 1.41 2.80 03 100
1992 0.32 1.57 3.98 0.98 0.33 3.42 3.00 1.47 2.58 1.16 100
1993 0.46 1.93 6.83 0.69 1.32 3.14 3.43 1.35 2.54 1.00 100
1994 0.39 1.91 7.62 1.13 1.36 2.65 5.03 1.47 2.86 1.11 100
1995 0.03 1.25 5.46 0.87 1.59 2.68 2.99 1.56 1.81 1.01 100
1996 0.01 1.13 5.19 0.70 1.13 2.65 3.75 1.37 1.68 1.09 100
1997 0.77 0.81 5.59 0.64 1.04 3.25 2.84 1.35 1.20 0.95 100
1998 1.20 0.50 7.63 0.89 1.32 4.17 2.47 1.86 1.78 1.48 100
1999 0.51 0.34 7.16 0.72 1.18 3.32 2.53 1.45 1.56 0.69 100
2000 0.65 0.34 7.24 0.88 1.31 2.78 3.28 1.51 1.09 0.77 100
2001 0.07 0.23 9.75 1.16 1.71 3.49 3.24 1.98 1.53 1.13 100
2002 0.23 0.32 8.19 1.13 1.68 3.02 4.37 2.02 2.19 1.35 100
2003 0.36 0.41 6.55 1.05 1.17 2.54 4.22 1.78 2.08 0.77 100
2004 0.15 0.66 6.25 0.87 1.00 1.72 4.46 1.90 2.21 1.07 100
2005 0.97 0.80 8.00 0.98 1.27 2.02 4.91 2.02 2.50 0.68 100
2006 0.22 1.48 7.74 0.98 1.38 2.59 1.39 1.82 3.23 1.26 100
2007 0.07 0.62 6.33 0.91 1.47 2.54 5.39 1.67 2.88 0.95 100
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2008 0.54 0.52 6.10 0.99 1.73 2.40 6.95 1.63 2.59 0.92 100
2009 0.23 0.74 9.79 1.13 2.11 4.04 6.08 1.83 3.76 1.35 900
*1991‐00 9.06 ‐17.39 12.01 6.48 14.91 7.18 3.41 8.42 ‐2.77 3.68 5.89
*2001‐2009 14.17 24.94 18.05 21.34 22.68 23.60 26.13 13.95 21.88 14.94 15.91
*2001‐2010 17.95 20.70 18.22 15.74 21.30 22.50 24.36 15.07 20.97 19.27 17.45
#1991‐00 CV 92.57 51.96 34.17 21.62 33.53 29.04 21.11 25.12 17.79 24.10 22.26
#2001‐09 CV 77.67 59.99 56.83 92.31 63.91 78.64 88.91 40.33 57.59 52.21 43.41
#2001‐10 CV 7.68 5.57 5.74 8.82 6.12 7.31 8.11 4.72 5.76 7.57 5.39
Source: Calculated from www.fao.org Note: Major Import Value: 000’ in million dollars $, *‐ Compound annual growth rate (CAGR), # co‐
efficient Variation (CV)
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3.3.2). ANALYSIS OF INDIA’S RICE IMPORTS: MOVEMENT IN VALUE OF
IMPORTS:
Table‐3.16 Compound Annual Growth Rate And Co‐Efficient Of Variation For Rice Exporting
Country As Percentage Of Total World Exports Of Rice
Countries/Year
*CAGR #CV
1991‐2000 2001‐2010 1991‐2000 2001‐2010
Sri Lanka 9.06 17.95 92.57 7.68
Benin ‐17.39 20.70 51.96 5.57
Saudi Arabia 12.01 18.22 34.17 5.74
Oman 6.48 15.74 21.62 8.82
Kuwait 14.91 21.30 33.53 6.12
Malaysia 7.18 22.50 29.04 7.31
UAE 3.41 24.36 21.11 8.11
Canada 8.42 15.07 25.12 4.72
Côte d’Ivoire ‐2.77 20.97 17.79 5.76
Syrian Arab
Republic 3.68 19.27 24.10 7.57
World 5.89 17.45 22.26 5.39
Source: calculated by taking the values in table‐3.4.
Note: *CAGR‐ Compound Annual Growth Rate, #CV‐ Co‐efficient of Variation.
Table‐3.16 provides the details of major importers and their percentage of
share in world import (value in 000’ $). The import of rice by different major
importers during the 5 decades between 1961‐70 and 2000‐08 has indicated
some significant trends. The imports of rice by Sri Lanka which topped the list of
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major importers have shown a continuous decline during the above period. Its
share declined from 58.71 per cent during 1961‐70 to 29.37 per cent in 1971‐80,
4.94 per cent in 1981‐90, 4.41 per cent in 1991‐00 and to 2.82 per cent during
2000‐08. Malaysia’s share declined from 48.90 per cent during 1961‐70 to 21.46
per cent during 2000‐08. Saudi Arabia’s share in world imports of rice on the
other hand rose from 26.71 per cent during 1961‐70 to 57.35 per cent during
2000‐08. UAE’s share in world imports rose from 3.60 during 1961‐70 to 42.28
per cent in 2000‐08. Cote d’Ivoire’s share rose from 7.89 per cent to 20.04 per
cent during the corresponding period. Canada’s share went up from 4.03 per
cent to 14.54 per cent. Kuwait share increased from 6.77 to 11.50 per cent
during the above period. Imports by Syrian Republic too rose from 5.08 per cent
in 1961‐70 to 7.65 per cent during 2000‐08. Oman’s imports rose from 1.05 per
cent during 1961‐70 to 9.37 per cent during 2000‐08.
3.3.3. DIRECTIONS OF MAJOR PRODUCING COUNTRIES TO MAJOR EXPORTING COUNTRIES:
Table‐3.17 India’s rice exports as percentage of total exports of rice to major rice importing
countries of the world
Source: www. Calculated comtrade.com database, Note: Classification SITC Rev‐2, Code ‐ 042
Table‐3.17 provides details about exporting countries. India’s rice exports
during the last four decades has indicated some significant trends, United Arab
Emirates has been a major importer of rice from 1978 to 2009. The value of
Countries/ Year
1978 1980 1990 2000 2009
Value
Value
Value
Value
Value
UAE 17.39 5.09 4.33 3.94 20.70
Kuwait 12.76 6.33 7.87 2.28 3.13
Oman 10.81 2.67 1.04 2.78 NA
Qatar 7.37 NA NA 0.42 0.40
Bahrain 6.43 NA NA 1.75 NA
Saudi Arabia 5.06 8.61 47.98 24.86 27.78
UK 4.71 7.12 7.63 5.63 2.58
USA 1.61 4.00 4.15 2.33 0.74
USSR 36.56 NA NA NA NA
Singapore 1.50 22.72 1.06 0.23 0.68
Above total 104.2 56.54 74.06 44.22 56.01
World 100 100 100 100 100
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UAE’s imports from India has however declined continuously between 1978 and
2000. There has been an upward trend in the UAE’s imports from India since
2000 from 3.94 million US $ to 20.70 per cent. Rice exports from India to Kuwait
again a major market has indicated a declining trend from 12.76 million US$ to a
mere 3.13 million US$. Another major importing country Oman has also reduced
its imports from 10.81 million US$ in 1978 to 2.78 million US$. A significant
thrust to India’s rice exports is seen in case of Saudi Arabia. India’s exports of rice
rose from 5.06 million US$ in 1978 to 27.78 million US$ exports of rice from India
to other countries has declined during the period from 1978 to 2009.
3.4. COMPETITIVENESS OF INTERNATIONAL PRICES OF RICE:
Table‐3.18 Average of Free Market Prices and Price Indices of Selected Primary Commodities
(Annual 1961 ‐ 2010) Base Year ‐ 2000
Product/ Avg ALL FOOD FOOD_TB ‐FOOD TROPICAL_B Veg_Oil Agri_Raw Rice
1961‐1970 53.41 52.07 51.82 54.29 64.60 42.96 78.93
1971‐1980 124.38 122.63 119.09 153.57 139.00 84.58 156.74
1981‐1990 122.90 121.69 117.01 162.57 133.02 108.34 140.95
1991‐2000 123.81 122.00 121.27 128.26 138.90 119.70 144.69
2001‐2010 155.96 153.21 155.37 134.27 178.97 144.65 173.93
15 Years Average
1961‐1975 71.98 70.66 71.58 62.67 82.97 49.23 102.73
1976‐1990 128.49 126.93 120.36 184.29 141.44 108.02 148.36
1991‐2005 119.75 117.86 117.84 118.04 135.51 116.85 132.36
1996‐2010 145.08 142.47 143.34 134.88 166.80 133.90 161.72
Source: Calculated from UNCTAD Hand book statistics 2009a, commodity price online.
Note: All food, food and Tropical Beverage, Vegetable oil seeds and oils, Agricultural Raw Materials,
Rice: Thailand, white milled, 5% broken, nominal price quote, FOB Bangkok.
Average Free Market Prices and Price Indices:
The table‐3.18 shows details an all‐round increase in the price indices of
the selected primary commodities viz. all food commodities, food and tropical
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beverages, vegetable oils, agricultural raw materials and rice. The price indices of
all food items rose from 53.41 per cent (1961‐70) to 155.96 (2001‐2010)
indicating an increase of three times. The price of food and tropical beverages
has indicated a largely identical position. The index rose from 52.07 per cent and
153.21 (1961‐70 to 2001‐10). Further identical rise in price index of food is found
which rose from 51.82 per cent (1961‐70) to 155.37 per cent (2001‐10). The
increase in price index of tropical beverages is slightly slow which rose from
54.29 (1961‐70) to 134.27 per cent (2001‐10). The price index of vegetable oil
has gone up from 64.60 per cent (1961‐70) to 178.97 (2001‐10). The price index
of agricultural raw materials is slightly steeper, it rose from 42.96 (1961‐70) to
144.65 (2001‐10). The rise in price index has been slow; it rose from 28.93 per
cent (1961‐70) to 173.93 per cent (2001‐10). The price indices in terms of 15
years average indicate a relatively slow increase in the various 15 years period
from 1961‐75 to 1996‐2010. Compared to the other primary commodities the
price index of rice appears to be moderate.
Table‐3.19 Average of International Prices Instability Indices and Trends of Free‐Market
Commodity Prices for Selected Periods, (Annual, 1981‐2010)
Measures Product/ Avg Combined All food Food _TB Rice Tropical_B Veg_ oils Agri_ raw
Price instability
indices
1981‐1990 11.94 12.14 12.54 19.99 14.32 17.93 7.18
1991‐2000 10.19 11.80 11.46 13.77 22.95 16.48 10.07
2001‐2010 9.76 7.52 7.65 13.92 6.36 15.29 7.60
2001‐2005 4.84 3.71 4.14 5.32 7.22 9.84 5.44
2006‐2010 9.25 8.89 8.25 21.13 5.30 20.72 9.33
Price trends
(in current
dollars)
1981‐1990 0.52 ‐1.33 ‐0.97 ‐2.40 ‐4.87 ‐3.96 2.06
1991‐2000 ‐1.28 ‐1.02 ‐1.23 ‐2.95 2.91 0.40 ‐2.26
2001‐2010 12.24 10.79 10.75 15.03 11.08 11.14 9.13
2001‐2005 9.86 6.51 5.94 12.32 9.96 11.08 8.78
2006‐2010 6.67 11.07 11.13 16.08 11.25 10.97 7.91
Price trends 1981‐1990 ‐3.82 ‐5.67 ‐5.31 ‐6.73 ‐9.20 ‐8.29 ‐2.29
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(in constant
dollars)
1991‐2000 ‐1.74 ‐1.48 ‐1.69 ‐3.40 2.46 ‐0.05 ‐2.72
2001‐2010 8.28 6.84 6.80 11.06 7.13 7.19 5.18
2001‐2005 4.33 0.99 0.42 6.78 4.43 5.54 3.26
2006‐2010 5.16 9.56 9.61 14.55 9.73 9.45 6.39
Source: Calculated from UNCTAD Hand book statistics 2009a, commodity price online. Rice: Thailand,
white milled, 5% broken, nominal price quote, FOB Bangkok. Note: All food, food and Tropical Beverage,
Vegetable oil seeds and oils, Agricultural Raw Materials,
The table‐3.19 shows details averages of Instability Indices and Trends of
Free Market Commodity Prices for selected periods Price instability indices
indicates a high level of instability 1981‐1990, 1991‐2000, 2001‐2010 and 2006‐
10. However, the instability is low during 2001‐05. A similar trend is indentified
during the above periods for all food category, food and tropical beverages, rice
for tropical beverages, vegetable oils, and agricultural raw materials, low
instability is found during only during 2001‐05. Price trends for these group of
commodities is negative or low level during 1981‐90 and 1991‐2000. For the rest
of the time periods prices appear to be on a higher level under current dollar
terms. Under constant dollar prices a similar trend of negative and lower prices
are found during 1981‐90, and 1991‐2000. Further higher level of prices have
been found during 2001‐10 and 2006‐10 while lower prices are found during
2001‐05.
Table‐3.20 Value of Co‐efficient Variations (CV) of Monthly Free Market Prices and Price Indices
of Selected Primary Commodities (Monthly Jan 1960 ‐ Dec2011) Base Year ‐ 2000=100
Source: calculated from UNCTAD.com online price data.
Period ALL FOOD * FOOD _ TB Tropical _ B * VEG_ OILS Rice
Jan1960‐Dec1970 8.64 9.97 9.65 10.74 18.61
Jan1971‐Dec1980 32.20 32.90 55.06 31.42 40.28
Jan1981 to Dec90 15.25 15.86 21.51 26.06 27.13
Jan1991 to Dec00 13.02 12.89 28.71 18.12 17.95
Jan2001 to Dec11 36.65 36.30 39.42 41.93 50.15
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Table‐3.20 provides detailed value of co‐efficient variation of monthly
free market prices and international prices base year 2000=100. Monthly free
market prices selected for primary commodities all food accounted for 8.64 per
cent to comparative slightly increase in rice prices i.e, 18.61 in during period Jan
1960 and Dec 1970 respectively. But food tropical beverage accounted for 32.90
to rice price i, e., 40.28 comparative decline, the vegetable oils is 31.42 , per cent
from Jan 1971 to Dec 1980. Since mid Jan 1980s all food commodities prices
declined to 15.25 per cent, vegetable oils accounted for 26.06 coefficient variation
but rice price rose to recording 27.13 slight changed respectively. From Jan 1991
and Dec 2000’s this trend tropical beverage i., e. 28.71 (C.V), slowly It got declined
compared to international rice price i., e, 17.95 coefficient variation during this
decade. Recent trend showed upward for international prices for all food i., e.
36.65 to 41.93 for vegetable oils, rice prices slightly increased from Jan 2007 to
Dec2011. Compared to earlier period establishment of WTO in the year 1995, it
was expected that agriculture prices will increase and the volatility of agricultural
prices will be reduced (Gulati and Sharma 1998).
Figure‐3.1 Monthly Free Market Prices and Price Indices of Selected Primary Commodities
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0100200300400500600700800900
100011001200
Jan-
-200
7
Mar
--20
07
Ma y
--20
07
Jul y
--20
07
Se p
t--2
007
Nov
--20
07
Jan-
-200
8
Mar
--20
08
Ma y
--20
08
Jul y
--20
08
Se p
t--2
008
Nov
--20
08
Jan-
-200
9
Mar
--20
09
Ma y
--20
09
Jul y
--20
09
Se p
t--2
009
Nov
--20
09
Jan-
-201
0
Mar
--20
10
Ma y
--20
10
Jul y
--20
10
Se p
t--2
010
Nov
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10
Jan-
-201
1
Mar
--20
11
Ma y
--20
11
Jul y
--20
11
Se p
t--2
011
Nov
--20
11
Figure-9 Monthly Free Market Prices and Price Indices of Selected Primary Commodities
ALL FOOD FOOD _ TB Tropical _ B VEG_ OILS Rice
Source: www. UNCTAD commodity online price data
3.5. IMPACT OF TRADE LIBERALIZATION EXPORT AND IMPORT PRICES OF RICE AND ITS TRADE
FLOWS:
Table‐3.21 Monthly International Rice Export price (US$/t free on board) of Thai rice 5%
brokens‐1991‐2010
Year/
Month Jan Feb March April May June July Aug Sept October Nov Dec
1991 324 343 337 312 305 309 315 315 315 305 304 294
1992 290 290 290 291 292 294 295 293 287 276 275 276
1993 280 279 266 251 229 227 230 230 234 284 353 370
1994 435 448 423 413 391 345 315 315 305 300 300 300
1995 284 284 286 282 288 326 346 340 360 383 341 342
1996 369 368 360 327 332 342 358 336 328 313 315 319
1997 356 347 323 304 324 323 320 285 271 267 252 270
1998 288 297 296 312 318 326 324 321 321 299 270 278
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1999 300 280 256 236 244 254 259 245 229 217 228 234
2000 241 241 226 215 199 196 189 187 179 188 185 184
2001 184 185 175 164 164 168 169 168 173 171 174 179
2002 192 195 189 190 198 203 200 190 187 186 187 186
2003 201 199 197 195 198 203 199 195 198 196 193 197
2004 213 213 238 241 232 229 231 239 235 244 259 278
2005 287 290 293 297 294 285 277 283 285 286 278 281
2006 291 302 304 302 308 313 315 313 309 301 296 305
2007 313 315 323 317 318 323 329 328 325 329 342 361
2008 376 465 594 907 902 757 732 694 684 609 552 532
2009 580 591 588 550 533 575 572 445 439 413 397 399
2010 478 528 591 729 717 666 652 569 562 511 474 465
Avg
1991‐00 316.70 317.70 306.30 294.30 292.20 294.20 295.10 286.70 282.90 283.20 282.30 286.70
Avg
2001‐10 311.50 328.30 349.20 389.20 386.40 372.20 367.60 342.40 339.70 324.60 315.20 318.30
Source: Rice Committee Board of Trade of Thailand‐1961‐94, Market Report, World Bank online‐ 1995‐2009
Note: Data refer to Thai 100B% FOB (free on board).
Table‐3.21 provides the details of share of monthly international rice
export price of Thailand rice. There is a declining trend of average monthly
international rice export price of Thailand rice (5% broken) during the decade
from 1991‐00. The average price (FOB) of this variety of rice varied between US$
316.70 in January to US$ 286.70 in December 1991. The average maximum price
during this period was US$ 317.70 in February and average minimum price was
US$ 282.30 in November 1991. The average export price of this variety of
Thailand rice during 2001‐10 varied between US$ 311.50 in January and US$
318.30 in December. Reflecting a strong pace of shipments in the first quarter,
FAO has slightly raised its forecasts of world rice trade in calendar 2011 to 31.8
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million tonnes. At this level, the volume of exchange would be about 400 000
tonnes, or 1 per cent above the 2010 level, and only some 200 00. The maximum
average price during this period was US$ 389.20 in April and the average
minimum price was US$ 311.50 in November. On the export side, Thailand is still
expected to account for much of the expansion, but volumes delivered by Brazil,
Cambodia, China, India, Uruguay and, especially Vietnam are also foreseen to
rise, offsetting reduced exports from Pakistan and the United States.
Table-3.22 Exports of different varieties of rice of major rice exporting countries (quotas in rice)
Country/Region
Long grain
Paddy
Medium/Short
TRQ
(tons)
Milled
Brown Milled Brown Non‐
fragrant
Fragrant
Brazil 15.0 15.0 13.0 13.0 15.0 13.0
China 1.0 1.0 1.0 1.0 1.0 1.0 5,320,000
India 70.0 70.0 80.0 80.0 70.0 80.0
Indonesia 21.0 16.1 25.0 35.0 14.3 15.6
Japan (yen/kg) 34 341 341 341 34 341 682,000
Malaysia 0.0 0.0 0.0 0.0 0.0 0.0
Other Asia 0.0 0.0 0.0 0.0 0.0 0.0
Philippines 50.0 50.0 50.0 50.0 50.0 50.0
United States ($/ton) 14 14 21 18 14 21
Sources: AMAD (Agricultural Market Access Database), USDA, FAS GAIN reports.
Table‐3.22 provides the details of percentage share of rice of major exporting
countries in world. Maximum 70 per cent of India’s long‐grain variety of non‐
fragrant and fragrant rice, and 80 per cent of brown rice accounts for its exports
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in world market. Further 80 per cent medium/short paddy 80 per cent, 70 per
cent of milled rice and 80 per cent of brown rice is accounted for in export
market. It is found that 50 per cent each of long‐grain fragrant, non‐fragrant
milled rice, and 50 per cent of brown rice of Philippines is accounted for in export
market. Similarly, medium/short variety of paddy (50%), milled (50%) and brown
(50%) are accounted for in world export. Other major exporters of these varieties
of rice are Indonesia and Brazil.
Table‐3.23 Rice flow model on the basis of rice trade liberalization
Rice Type Baseline Free Trade % Change
Long Grain High Quality (Paddy)
Quantity (MT) 1,035,320 1,081,254 4.4%
Export Price (USD/MT) 149.21 154.67 3.7%
Import Price (USD/MT) 185.51 166.89 ‐10.0%
Brown
Quantity (MT) 856,798 916,721 7.0%
Export Price (USD/MT) 223.75 219.25 ‐2.0%
Import Price (USD/MT) 363.32 250.64 ‐31.0%
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Milled
Quantity (MT) 7,495,594 7,704,482 2.8%
Export Price (USD/MT) 225.97 225.58 ‐0.2%
Import Price (USD/MT) 262.06 252.16 ‐3.8%
LOW QUALITY (Milled)
Quantity (MT) 8,084,093 9,149,728 13.2%
Export Price (USD/MT) 177.05 188.70 6.6%
Import Price (USD/MT) 248.19 213.09 ‐14.1%
Fragrant (Milled)
Quantity (MT) 2,449,711 2,467,502 0.7%
Export Price (USD/MT) 265.24 267.07 0.7%
Import Price (USD/MT) 511.20 299.07 ‐41.5%
All Long Grain
Quantity (MT) 19,921,516 21,319,687 7.0%
Export Price (USD/MT) 206.87 210.68 1.8%
Import Price (USD/MT) 287.45 236.43 ‐17.7%
Medium/Short Grain (Brown)
Quantity (MT) 483,063 1,162,478 140.6%
Export Price (USD/MT) 271.80 814.47 199.7%
Import Price (USD/MT) 1438.54 842.75 ‐41.4%
Milled
Quantity (MT) 2,487,760 3,946,170 58.6%
Export Price (USD/MT) 367.71 628.92 71.0%
Import Price (USD/MT) 855.89 645.69 ‐24.6%
All Medium/Short Grain
Quantity (MT) 2,970,823 5,108,648 72.0%
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Source: University of Arkansas, RICEFLOW Model. 2003.
Table‐3.23 provides the details of percentage change in rice trade
liberalization from RICEFLOW model during 2000. The details of the trade
volume quantity, export price and import price of rice of different varieties
during the trade liberalization RICEFLOW model during 2000 are presented in
the table (Long‐Grain in High Quality). There has been a positive change
(increase) in the quantity of trade of long‐grain high quality rice by 4.4 per cent
subsequent to rice trade liberalization from RICEFLOW model during 2000.
Export price of rice rose by 3.70 per cent. While import price declined by ‐10.0
per cent during 2000. (Brown Rice) The quantity of brown rice traded during the
period rose by 7.0 per cent. While export price of this variety of rice declined by
‐2.0 per cent and import price declined steeply by ‐10.0 per cent (Milled Rice).
The quantity of milled rice traded subsequent to liberalization went up by 7.0
per cent, export price declined by ‐0.2 per cent and import price went down by ‐
3.8 per cent. (Low Quality (Milled) Rice). Trade in low quality (milled) rice
increased by 13.2 per cent and export price of this variety of rice rose by 6.6 per
cent, import price declined by 14.1 per cent. (Fragrant (Milled). Trade in fragrant
(milled) rice rose marginally by 0.7 per cent and export price too increased by
0.7per cent import price declined substantially by ‐41.5 per cent (All Long
Grain). Trade volume rose by 7.0 per cent and export price increased by 1.8 per
cent, import price declined by ‐17.7 per cent. Medium/Short Grain (Brown).
Export Price (USD/MT) 352.11 671.14 90.6%
Import Price (USD/MT) 950.63 690.53 ‐27.4%
All Rice
Quantity (MT) 22,892,339 26,428,335 15.4%
Export Price (USD/MT) 225.71 299.69 32.8%
Import Price (USD/MT) 373.51 322.97 ‐13.5%
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There has been a substantial increase in the volume of trade (quantity) of
medium/short grain (Brown) variety of rice by 140.6 per cent export price went
up substantially by 199.7 per cent, import price declined by ‐41.4 per cent
(Milled). Trade volume of milled rice increased by 58.6 per cent and export price
rose by 71.0 per cent. The decline in import price was ‐24.6 per cent (All
Medium/Short Grain). There was a substantial increase in the trade volume of
this variety of rice by 72 per cent. While export price rose by 90.6 per cent
import price declined by ‐27.4 per cent. (All rice), All variety of rice registered
an increase of 15.4 per cent in their trade volume (quantity), export price rose
by 32.8 per cent but import price declined by ‐13.5 per cent.
Table‐3.24 provides the details of country wise imports and exports after
global rice policy reform during 2000. There has been a decline (‐7) in imports of
high quality long grain brown rice by Cote d’Ivoire in 2009, but its imports of low
quality milled rice stood at 2396600 worth of USD imports of high quality long
grain milled rice by other Asian countries was 895000, USD, medium grain milled
rice imports by 18489000 USD and it imports of low quality milled rice went
down to ‐1928000 USD, Philippines imports of low quality milled rice (long grain)
was 72331000 USD, Russia imported 660000 USD worth of long grain high
quality milled rice and medium milled rice went down by ‐470000 USD and ‐
11517000 USD, Saudi Arabia imports of high quality milled rice and fragrant
milled rice went down by ‐2875000 USD and ‐73000 USD respectively. Sri Lanka
imported long grain low quality, milled rice worth 11600,000 USD. UAE’s imports
of high quality milled rice and fragrant milled rice went down by ‐1661000 USD
and ‐27000 USD of the total imports. Long‐grain fragrant milled rice are higher
compared to other varieties by major importing countries, the change from the
baseline indicates positive net welfare and consumer surplus and negative
producer surplus in 2009. A also provides details of major exporting countries i.,
e, long grain high quality milled rice (long‐grain), maximum exports have taken
place from Thailand and minimum exports have taken place from China. High
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quality brown rice and paddy have taken place from USA. In the variety low
quality milled rice is from Vietnam and Myanmar who accounted accounted for
maximum and minimum exports in 2009. USA and India accounted for maximum
and minimum exports of fragrant milled rice respectively in 2009. In the medium
grain category milled and brown rice were exported from China and USA only
change from baseline in terms of ‘net welfare’ and producer surplus. China and
United States were the top exporters of rice in 2009. All major exporting
countries indicated negative (‐) consumer surplus indicated through change
from baseline.
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Table‐3.24 Impact of Global Rice Policy on Economic Welfare of Major rice exporting and importing Countries
(‘000 USD)
Major Importing Countries
Country/Region
Long‐ grain Change from Baseline
High Quality Low Quality Fragrant Medium ‐Grain Net Producer Consumer
Milled Brown Paddy Milled Milled Milled Brown Welfare Surplus Surplus
Cote d’Ivoire ‐7 23,966 23,959 ‐32,023 55,982
Other Asia ‐895 ‐1,928 ‐18,489 ‐21,313 29,543 ‐50,856
Philippines 72,331 72,331 ‐628,991 701,323
Russia 660 ‐470 ‐11,517 ‐11,328 648 ‐11,976
Saudi Arabia ‐2,875 ‐73 ‐2,948 0 ‐2,948
Sri Lanka 1,160 1,160 ‐109,104 110,264
U.A. Emirates ‐1,661 ‐27 ‐1,689 0 ‐1,689
Total Importers 40,879 132,264 22,352 315,259 546,982 3,440,022 1,033,463 5,531,222 ‐27,225,538 32,756,760
Major Exporting Countries
Country/Region Long Grain Medium grain Change from Baseline
High Quality Low Quality Fragrant Net Producer Consumer
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Milled Brown Paddy Milled Milled Milled Brown Welfare Surplus Surplus
China 2,232 11,593 625 479,914 154,951 649,315 64,206,673 ‐63,557,358
India 3,510 1,961 570 6,041 972,850 ‐966,810
Myanmar 884 884 128,494 ‐127,610
Pakistan 4,521 10,422 1,118 16,061 39,040 ‐22,979
Thailand 11,072 9,817 1,132 22,021 123,327 ‐101,306
United States 3,597 4,613 1,989 2,578 2,492 85,639 224,822 325,729 2,184,697 ‐1,858,968
Vietnam 2,652 15,894 18,546 229,127 ‐210,581
Total Exporters 28,274 ‐8,125 2,356 51,659 5,937 905,212 449,094 1,434,408 70,247,441 ‐68,813,033
Total Welfare 69,153 124,139 24,709 366,918 552,919 4,345,234 1,482,557 6,965,629 43,021,903 ‐36,056,274
Source: www.USDA.com
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3.6. CONCLUSION:
Government policies that interfere with the rice sector are a continuous
phenomena. Such policies are imposed due to political, social and economic
reasons. The increase in the import bill would have an adverse effect on the
trade balance. This is consistent with expectations, given that policies towards
rice exports and imports are not symmetric, and India has tended to have
domestic prices lower than international prices in recent years. Deformations in
rice trade occur throughout the world. State trading enterprises are pervasive in
rice trade, most notably in China, Indonesia, India, Japan, Vietnam, and USA.
State trading trends result in lack of transparency in pricing and trade
competitiveness. India is all set to export basmati rice to China as the two sides
have been able to sort out regulatory issues blocking the export. Liberalization
will have important ramifications in terms of the redistribution of the benefits
from rice production within countries. Thailand is a clear exception, as rice trade
is managed by a very competitive group of export companies. Policy reforms to
reduce protection in the global rice economy are estimated to boost economic
welfare by more than $7.4 billion per year. The prospects for the success of the
Doha Round of the WTO midpoint to a great extent on continuing the expansion
of market access, reduction of tariffs, and limits on export subsidies required to
achieve the benefits estimated here from global trade liberalisation. Price
competitiveness of rice production in India, as well as its policy determinants,
during the recent period of price liberalization and other economic reform are
satisfactory. Our measure of price competitiveness incorporates both the
product (rice) price. Because of serious instability in both financial markets and
the world rice market, price stabilization will remain an important issue in the
Asian rice economy for many years to come. This is not to argue that all
governments stabilize prices in a cost‐effective manner. Instead of insisting on
complete adherence to the free trade paradigm, however, economists can make
an important contribution by helping to design policies that stabilize rice prices
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in a transparent, market‐friendly, cost‐effective manner. Thus, there is an urgent
need to reform the rules governing interstate commerce in food‐grains and to
overhaul the attendant state government tax policies and regulations. In case of
rice producing countries such as Vietnam, Pakistan, and Thailand, higher
producer prices will lead to improvements in income of households that are net
rice suppliers. The same reasoning but in opposite direction applies to the
Philippines and Malaysia, where the lower producer prices might lead to
reductions in income of net‐rice suppliers and, thus, a counter effect on food
security. There is an urgent need to reform price policy relating to producer,
wholesaler and consumer price. The decomposition framework used in the
present study can provide a useful aid to policy analysis and formulation. The
observed dominance of adverse consequences of macroeconomic policies
adopted during the period strongly suggests that there is need for a macro
economic perspective in analysing the changes in price competitiveness of rice in
India.
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