BANGKOK (dpa) - The price of rice has stayed stable over the past two months of soaring prices on other foodstuffs thanks to considerable stockpiles of the staple grain in Asia, commodity experts said.
In July, global food prices rose 10 percent compared with June, due to drought and high temperatures in the United States and Eastern Europe, with maize and wheat up 25 percent and soybean up 17 percent, according to World Bank estimates. But during the same month, the international price of rice fell 4 percent, the bank said.
The situation eased in August, thanks in part to Hurricane Isaac which brought much-needed rain to the US maize and soybean crops.
According to World Bank data, in August wheat prices went up 1.07 percent, compared with July, soya beans were up 2.21 percent, maize fell 0.23 percent and rice was down 0.14 percent.
The global food price index of the United Nations' Food and Agriculture Organization (FAO) neither rose nor fell in August, after surging 6 percent in July.
"If rice prices were not stable, then that 6 percent would have been much greater," Asian Development Bank food security expert Lourdes Adriano said.
Rice remains the main staple food in Asia, home about half the world's population. Wheat prices in Asia have also been relatively stable over the past two months, due to massive stockpiles in northern India, northern China, Pakistan and Afghanistan.
"At least in Asia, there is no sense of crisis," said Sumiter Broca, a commodities expert at the FAO's regional headquarters in Bangkok.
Fears that India's rice crop would be affected by drought this year have disappeared with the belated monsoon rains in August.
India's crop is expected to fall only slightly below the 104 million tons achieved in 2011, a bumper harvest for the country of 1.2 billion people, according to the FAO.
The better-than-expected rice crop means it is highly unlikely that India will ban rice exports in 2012, as it did five years ago, helping to cause the food crisis of 2008 when global rice prices hit a historic peak of 1,100 dollars per ton, double the norm.
The FAO estimates that India's current rice stockpile is close to 30 million tons, exceeding the country's warehouse capacity.
"They will not stop exporting, that's for sure now," Broca said.
"India is being a responsible global citizen by keeping rice prices stable."
That is good news for rice importers in Asia, Africa and the Middle East, who can expect international rice prices to remain in the range of 450 dollars per ton for high-quality plain white rice.
But the low global rice price is bad news for exporter Thailand, where the government has been buying rice from farmers at fixed, above-market prices, part of a populist policy aimed at boosting rural incomes that helped the Pheu Thai Party win the July 2011 general election.
Since October the government has been paying farmers 15,000 baht (484 dollars) per ton of plain rice paddy (unhusked rice) and 20,000 baht per ton of jasmine paddy, the fragrant rice Thailand is famed for.
While farmers seem to like the scheme, it is effectively pricing Thai rice exporters out of the market this year.
Thailand has been the world's leading rice exporter for the past five decades, but is expected to lose that slot to either India or Vietnam in 2012.
"As of mid-September, Vietnam has exported 5.3 million tons, India about 4.9 million and Thailand about 4.7 million, so we are in third place now," said Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association.
Thailand has amassed a stockpile of close to 11 million tons of unsold rice. If the government unloads it on to the international market this year, it will have to do so at a big loss, Chookiat said.
The Thailand Development Research Institute (TDRI), an independent think tank, predicts the government rice policy could cost the country 112.5 billion baht (3.6 billion dollars) in losses this year.
"The only factor that could make the price of rice go up, is a serious drought in Asia," said TDRI President Nipon Poapongsakorn.
"It is possible, but not this year."