The global rice trade could contract quickly this year if India halts its exports and Thailand maintains its price subsidies for farmers, dpa cited the Asian Development Bank (ADB) as saying Thursday. "Maintaining careful watch on the current production year and consumption responses is of utmost importance" to avoid a repeat of the rice price crisis of 2007-2008, the ADB said it is report - Blueprint for a Stable Rice Market. Global rice prices soared to above 1,000 dollars per ton in 2008, after India and Vietnam imposed export bans on the grain, but have since fallen steadily, hitting 486 dollars per ton for long-grained rice in 2011. While prices for wheat and oilseeds have jumped this year in response to drought in the United States, international prices of rice - the main food staple in Asia - should remain stable unless India reimposes its export ban, the ADB predicted. "Should India revert to an export ban as it liquidates its rice stock and suffers from monsoon failure, the rice economy could tighten quickly," the ADB report warned. "This is particularly true if Thailand insists on maintaining its paddy pledging price floor and implicit tax on its rice exports," ADB said. Since October, Thailand has offered farmers 15,000 baht (500 dollars) per ton of paddy (unhusked rice) in a bid to boost rural incomes. The populist scheme has made Thai rice prices artificially high on the world market, resulting in plummeting exports. India reportedly surpassed Thailand as the world's leading rice exporter in the first half of 2012, toppling the kingdom from the top slot it has held in the trade for the past five decades. Over the January-to-June period, Thailand's rice shipments plummeted 49 per cent, according to Commerce Ministry figures. "Despite current strong competition from other main rice exporters, Thailand is projected to return as the top exporter over the (10-year) baseline," the ADB said, adding that its projection hinged on the government eventually dropping its paddy pledging scheme. "Unless this happens, stock accumulation will become enormously expensive," it said. Thailand currently has more than 10 million tons of rice stockpiled in warehouses.
