Rising demand for IR and OM rice varieties boosts prices globally
The image of IR (left) and OM rice varieties. FB
Demand for IR and OM rice varieties for export is soaring across Europe and Asia, leading to an increase in prices, says a local rice export company.
This uptick in demand is largely due to the challenges posed by climate change and shifts in global food supply and demand.
Chan Pich, the general manager of Signatures of Asia Co Ltd, noted that the global rice market, particularly white or plain rice, is experiencing high demand.
“Early this year, climate change-induced droughts in regions including Europe, Australia and the US caused a surge in rice demand.
“The situation has been further intensified as India stopped exporting white and broken rice to satisfy its domestic requirements,” Pich said.
ASEAN countries, including populous nations such as Indonesia and the Philippines, are also experiencing a shortage of rice supply, he added.
“These countries have ordered white rice from fellow ASEAN nations like Vietnam and Cambodia,” he said.
As cost reductions improve, Pich expects the Philippine market to significantly boost Cambodia’s rice exports due to their large population.
Kim Savuth, managing director at Khmer Food Co Ltd, a major local rice exporter, attributed the rising food prices to the war crisis, transportation woes and climate change.
“The price of IR and OM dry season rice has recently seen an increase due to higher costs in raw materials, labour and fertiliser prices. Moreover, global food prices have surged, mainly due to the Russia-Ukraine war and droughts in certain countries,” he said.
According to Yourng Pakk, the CEO of Agribee Cambodia Plc, high prices for IR and OM rice could lead to reduced orders from local mills and increased buybacks from Vietnam.
“With the increase in rice prices, local mills are buying in smaller quantities. This is primarily because most of our farmers prefer to sell wet rice to Vietnam.
“Uncertainty in market prices makes our local mills reluctant to invest in stockpiled rice, leading to a reduction in rice exports,” he said.
A release from the Ministry of Agriculture, Forestry and Fisheries indicated that the current price of the IR rice variety is 1,047 riel ($0.26) per kilogram, while OM rice is priced at 1,029 riel per kilogram.
Despite being higher than IR and OM rice, the price of fragrant rice varieties has not seen a significant change over the past three years, averaging between 1,000-1,260 riel per kilogram, the ministry said.https://www.phnompenhpost.com/business/rising-demand-ir-and-om-rice-varieties-boosts-prices-globally
Published Date: July 26, 2023