By Luzi Ann Javier
Oct. 27 (Bloomberg) -- The Philippines, the world’s biggest rice buyer, plans to bring forward imports for 2010 to beat other nations to the market before prices surge and ensure stockpiles aren’t drained, the National Food Authority said.
“We need to prepare” for the shortfall, Jessup Navarro, administrator of the authority, said in an interview in Manila yesterday. “We need to bring in the rice we need right away.”
The Southeast Asian nation is rushing purchases on concern that drought in India and weather-related damage to crops in other parts of Asia may lead to a supply shortage, Navarro said.
“That could exert huge pressure on prices,” he said. “When there’s speculation, people are hoarding, other countries stop exports, while importing countries are trying to buy. Speculation, panic; you cannot control that,” he added, when asked if he see prices returning to record levels.
Rice futures surged to a record $25.07 per 100 pounds on the Chicago Board of Trade in April 2008 as exporters including India and Vietnam curbed overseas sales and importers such as the Philippines rushed to boost shipments to secure domestic supplies and cool inflation.
Rice for delivery in January gained 0.2 percent to $13.70 per 100 pounds as of 10:54 a.m. Singapore time.
“For record prices to be hit again, it wouldn’t take much,” Euben Paracuelles, an economist at Royal Bank of Scotland Plc said by phone from Singapore today. “The same sort of weather problems are hurting output of these big rice exporters.”
Tender Advanced
The National Food Authority, which manages the government’s grain stockpiles, has set its first tender for Nov. 4, when it plans to buy 250,000 metric tons of rice for delivery beginning January, more than a month ahead of the typical date. More tenders may be held this year, Agriculture Secretary Arthur Yap said Oct. 23.
The impact of the storms that damaged crops in the Philippines will not be felt by the domestic market until June next year, when supplies from the October-December and March-May harvests begin to run out, he said. Harvests from other parts of the country that were spared by the storms have kept prices stable, he said.
About 13 percent of the 6.5 million metric ton fourth- quarter output forecast by the government in August was lost as Tropical Storm Ketsana and Typhoon Parma hit the nation’s biggest rice-producing regions, the Department of Agriculture said in a report released Oct. 13.
The Philippines is assessing the damage from the storms and the possibility of ramping up output in the first harvest of 2010 before setting the total volume of next year’s imports, Navarro said.
To contact the reporter on this story: Luzi Ann Javier in Manila at ljavier@bloomberg.net
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