Era of ‘cheap rice’ over but rising wages help laborers
Print Edition
THE decades-long era of “cheap rice” when technology drove down prices of Asia’s staple food may be over, but that could be good news for farm laborers, a UK think tank says.
While the rising cost of rice will hurt poor urban consumers, particularly in parts of Africa that import rice from Asia, increasing wages could help yank many Asian agricultural workers out of poverty.
“Millions of agricultural laborers stand to gain from higher wages, with potentially huge benefits for poverty reduction. But many poor households will also face higher food bills — and countries in Africa will face higher food import costs,” said Kevin Watkins, director of the London-based Overseas Development Institute.
A report by the institute yesterday says rice prices fell from the early 1970s to the early 2000s due to improved use of seeds, fertilizer and irrigation. But prices began to rise in 2002, and never returned to previous levels after they spiked during the global food crisis of 2007-08, when rice prices on world markets tripled.
In early 2013, rice prices topped US$550 per metric ton, double the level in 2000.
The report attributes the price gain to rising output costs: higher wages for laborers, more costly fuel and fertilizer, and higher stockpiling of rice by China, India and Thailand.
The amount of rice that is stored rather going to market has risen from a world total of 75 million metric tons in 2006-07, to 105 million metric tons by 2011-12, according to US Department of Agriculture.
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