RICE FACTS

Rice imports come with the territory

by D D
Economist

Exporters plant more than half of their crop area to rice importers less than half

sians eat rice daily, prompting politicians and policymakers in many countries to view imports of the staple grain as a sign of national failure. Leaving aside China and India, where wheat is almost as important as rice, analysis of historical rice trade patterns supports a contrary view. Countries are long-term members of one club for rice importers or, barring upheaval, another club for exporters. This strongly suggests some deep force at work. The reasons typically advanced for failure to achieve rice self-sufficiency faulty government policy, deteriorating irrigation systems, lack of farm credit, inadequate fertilizer use are too short-term to explain such steadfast club loyalty. This deep force is land endowment. Exporters occupy broad riverine deltas and plains with lots of land suitable for rice; importers are island or peninsular nations with more varied landscapes favoring such alternatives as maize, oil palm or coconut. The percentage of crop area devoted to rice tells the story. Figure 1 shows that consistent rice importers plant less than half of their crop area to rice, while countries that plant more than half to rice are consistent exporters (excepting Japan and Bangladesh because of their tiny area of arable land per person).

Fig. 2. Net trade status, selected Asian countries, 1905-2001.

Note: The values shown are 5-year moving averages to smooth year-to-year fluctuations. When imports exceed exports (+), net trade status is expressed as a % of consumption. When exports exceed imports (), net trade status is expressed as a % of production. This convention avoids reporting values exceeding 100%. Gaps reflect unavailable data. *Indochina includes Vietnam, Cambodia and Laos until 1949 and Vietnam and Cambodia from 1951, with trends in Vietnam dominating in both periods.

Fig. 1. Share crop area planted to rice, selected Asian countries, 1990-2001. Data: FAO.

Malaysia is the Asian country most reliant on rice imports, which account for 30% of its consumption. Other countries that import rice to meet a significant portion of demand, with percentages averaged for 1996-2002, are the Philippines (13%), Sri Lanka (9%), Indonesia (6%) and Japan (5%). Strikingly, all five have consistently imported rice for at least the past century (Figure 2). The Philippines, for example, has imported rice almost every year since 1869. Java, the destination for most of Indonesias rice imports today, has been a rice importer since the 16th century. Exports from these traditional importers have been sporadic and short-lived. The history of Asian rice exporters is similarly consistent, though war and ideological zeal complicated trends in three of them following the 1960s. Early in the 20th century, the countries
Rice Today April 2004

that exported the largest percentage of their rice production were Myanmar, Cambodia, Thailand and Vietnam all mainland Southeast Asian countries with large river deltas or plains. Today, Thailand dispatches 40% of its crop to world markets. Vietnam, having bounced back from a quarter century of scraping along, now exports a fifth of its rice production. Myanmar and Cambodia have struggled more than Vietnam but now appear set to redeem their traditional roles as rice exporters. Traditional importers have invested in irrigation systems to improve their land for rice. They now irrigate a much higher percentage of their rice land than do exporters, but these increasingly costly efforts have failed to eliminate the need to import. Land endowment remains the overriding factor that determines whether a country imports or exports rice.
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