InterRegional for Strategic Analysis


        
<p><strong>Cereal supply chains have experienced major challenges over the past few years as a result of environmental, economic, and geopolitical crises, as well as the COVID-19 pandemic. These crises have generated immense pressures on cereal production in different areas of the globe, especially on rice yields. This has had major ramifications for Asia. Rice is the main source of sustenance for more than half of the world’s population. Asia produces more than 90% of the world’s rice, and rice accounts for more than a quarter of the continent’s caloric intake. The UN estimates that the average Asian consumes 77 kilograms of rice per year, which is more than average African, European, and American consumption combined. Hundreds of thousands of Asian farmers depend on rice cultivation, which is facing numerous challenges. According to various reports, Asia—and the world as a whole— is likely to face a severe food crisis unless governments intervene quickly to identify solutions.</strong></p>



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<p class="has-vivid-red-color has-text-color"><strong>Contradictory Challenges</strong></p>



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<p>The rice crisis is both a factor driving other global challenges and a consequence of these same problems. There are growing fears that declining rice yields could lead to a global food crisis. On the other hand, rice cultivation is also responsible for various forms of health and environmental damage. In understanding the current situation, we might consider the following factors:</p>



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<p><strong>1. Lack of rice supplies due to the war in Ukraine: </strong>The COVID-19 pandemic, the Russian intervention in Ukraine, and the reluctance of key players in the global food economy to rely on international grain markets to meet domestic food security needs have collectively produced major shifts in food supply chains. Rising prices and energy supply disruptions led to increasing food costs throughout supply chains, from agricultural inputs and activities through processing, transport, and prices in retail outlets.</p>



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<p><strong>2. The threat of climate change: </strong>Adverse weather conditions, disruption of ports, and export barriers could all lead to markedly higher rice prices in 2023. Monsoon rains and droughts over the last year in India, the world’s largest rice producer, resulted in reduced yields and export bans. Meanwhile, catastrophic floods in Pakistan, the fourth largest producer of rice, destroyed 15% of its harvest. Rising sea levels have also resulted in increased salt intrusion in the Mekong River delta in southeast Asia, the "rice bowl" of Vietnam, which negatively impacted rice yields.</p>



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<p><strong>3. Demand for rice expected to increase:</strong> Demand for rice is projected to increase given current population growth in Asia as well as Africa, which is also a major consumer of rice. According to some estimates, the world needs to produce about a third more rice by 2050. <em>The Economist </em>reported that demand for rice in Africa and Asia is rising, which will exacerbate the crisis. By 2050, the population of Asia will have grown to 5.3 billion people, up from 4.7 billion today, and 2.5 billion in Africa, up from 1.4 billion today. This means that demand for rice is set to rise 30%.</p>



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<p><strong>4. Falling rice production in Asia:</strong> The growing trends towards urbanization and industrialization are accompanied by increasing scarcity of labor and agricultural land, as well as overuse of fertilizers and pesticides and over-irrigation. This results in contamination and depletion of soil and ground water, while global warming also affects rice production. All of these factors have led to diminishing production in Asia. Rice yields increased by only 0.9% per year over the last decade, down from 1.3% the decade before, according to UN data.</p>



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<p><strong>5. Increasing concerns about rice production</strong>: Some environmental activists have criticized rice production as a key driver of climate change and methane emissions. These factors indirectly reduce incentives to expand rice production. By this logic, rice cultivation is not only a victim of global warming, but also a primary driver for emissions. Rice fields emit significant amounts of methane gas. This crop feeds 60% of the world’s population, but is also a driver for the lack of global environmental security. According to some reports, irrigation of rice field exacerbates soil oxygen starvation, which encourages the growth of bacteria that produce methane gas. As a result, rice production is responsible for 12% of all methane gas emissions and 1.5% of total greenhouse gas emissions. This is on par with emissions from aviation. Vietnam’s rice fields produce much higher carbon emissions than its transportation industry.</p>



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<p><strong>6. Poor nutritional value of rice and links to illness: </strong>The poor nutritional value of rice is a source of growing concern for many. The cereal contains a high percentage of glucose, which contributes to diabetes and obesity. It also contains low levels of iron and zinc, which are important micronutrients, and deficiencies of these nutrients can lead to malnutrition. The prevalence of diabetes and malnutrition in south Asia is linked to overdependence on rice. These problems have undoubtedly shaped rice production in some countries.</p>



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<p><strong>7. Adverse consequences of government policies and interventions: </strong>Poorly-planned and obsolete forms of government intervention have also played a role in fears about rice productivity as well as environmental concerns. These policies distort markets and reduce incentives to change for the better. According to some reports, millions of Indian farmers have begun to rotate cultivation of rice and wheat due to government incentives. India then buys rice from farmers at set prices that were likely higher than actual market rates. It then sells the rice to the poor at subsidized prices, which in turn increased rice consumption. Fertilizers and irrigation are also subsidized. These kinds of interventions are prevalent throughout Asia and might be difficult to change since farmers constitute important vote banks for governments. For example, the Bharatiya Janata, India’s ruling party, backed away from sweeping agricultural reforms that they had been planning to launch in 2021 after farmers responded by organizing protests.</p>



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<p><strong>8. Labor scarcity and difficulty of growing rice: </strong>Between 1971 and 2016, the average farm size in India decreased by more than half, from 2.3 to 1.1. hectares, which made productivity more difficult to achieve. This contributed to labor scarcity especially since various agricultural activities such as sowing seeds in even rows, replanting seedlings, and harvesting, is very difficult work. Workers in Asia consequently began to seek other more profitable and less labor-intensive opportunities.</p>



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<p><strong>9. India limits access to rice yields: </strong>India, the world’s top rice producer, decided to curtail its rice supplies to Africa in May 2022, most notably with its export ban on broken rice. The population of western Africa heavily relies upon this food product. India also imposed a 20% tax on other rice exports and high-quality varieties of rice which dealt a blow to many African countries.</p>



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<p>India is trying to reduce its idle production capacity sold abroad in an effort to rein in local prices which have been affected by the severe drought. This has put African countries in a difficult situation, especially since countries like Senegal rely heavily on this food supply. According to the Africa Rice Center, Africa makes up 13% of the world’s population but 32% of global rice imports.</p>



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<p class="has-vivid-red-color has-text-color"><strong>Proposed Solutions</strong></p>



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<p>There is not a single solution to the worsening rice crisis, given the multifaceted nature of the problem, the various health and environmental repercussions, and current production deficits. However, there are many partial solutions that could help resolve the crisis, including the following approaches:</p>



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<p><strong>1. Bolster productivity using modern technologies: </strong>Governments in various countries can increase rice productivity by utilizing technologies that scientists have developed for varieties of flood-, drought- and heat-resistant rice as well as more nutritious varieties. This also makes it possible to use more fertilizers and pesticides while also creating healthier harvests. Furthermore, agricultural innovations such as direct seeding require less water and labor, and can reduce environmental harms while increasing productivity.</p>



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<p>These trends are evident throughout Asia. In Bangladesh, farmers who grow Sub1, a flood-tolerant variety of rice, successfully achieved 6% higher yields and 55% higher profits, according to a study published in <em>Food Policy </em>in 2021. Wider access to improved seed remains a challenge since many farmers do not know about these methods, and others do not want to try new approaches, according to a countrywide survey of Indian rice farmers in 2017-2018. The survey found that only 26% of farmers had adopted new varieties of seeds that had been released in 2004.</p>



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<p><strong>2. Promote ambitious plans for sustainable low-carbon rice production: </strong>Governments can play an important role in highlighting the benefits of new cultivation methods and varieties of rice, and Vietnam is leading the way. It recently announced an ambitious plan for about 1 million hectares of low-carbon rice production, which the state emphasized would provide employment and skill-building opportunities. Instead of calling for mitigating emissions, which would place the burden for change on farmers, the government has instead sought to find practical and workable solutions that enable farmers to become part of these solutions. This requires supplying farmers with improved seed and training them how to cultivate the seeds and utilize new technological innovations, instead of overloading them with campaigns without providing the tools that enable them to adopt these changes. Farmers also received significant compensation for these efforts which encouraged them to ramp up production and adopt more sustainable agricultural methods. Such measures also encourage farmers to stay in agriculture rather than moving to another sector.</p>



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<p><strong>3. Strengthen the role of agricultural extension agents as a link between farmers and policy-makers: </strong>Policy-makers often adopt major agricultural reforms without properly consulting farmers due to limited communication between the two sides. It will be necessary to adopt an incremental approach to change this. Agricultural extension workers can play a major role in knowledge transfer and training farmers how to grow new crops and to make the most of agricultural innovations. Farmers are often ignored by policy-makers, who in many countries direct most agricultural spending towards subsidies and irrigation. This primarily benefits wealthy farmers who own large swaths of land.</p>



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<p><strong>4. Adopt policies to reduce dependence on rice: </strong>Governments also need to make greater efforts to reduce dependence on rice. At India’s behest, the UN declared 2023 the International Year of Millets. India hopes to sell more millet to farmers and consumers, since this crop is more nutritious than rice or wheat, and requires less water. Indonesia also plays an important role in promoting millet production.</p>



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<p>Governments can work towards encouraging farmers to diversify and cultivate alternatives to rice and can promote new and more nutritious varieties of rice through campaigns and awareness raising. These steps will help prepare citizens to accept changes and reduce dependence on rice.</p>



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<p><strong>5. Develop new strategies to promote self-sufficiency: </strong>Governments can also make strides towards bolstering self-sufficiency through reducing dependence on imports and increasing arable land. Senegal is one of the countries working towards achieving this goal. In recent years, Senegal’s rice production has grown to around 840,000 tons annuals, enough to cover nine months of domestic consumption. As Senegal tries to implement a new strategy for self-sufficiency, Cote d’Ivoire is following suit. The latter reduced its imports of Indian rice by 24% between 2021 and 2022.</p>



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<p><strong>6. Lift subsidies that favor rice above other crops: </strong>Governments need to push producers and consumers alike to move beyond rice, which can happen through lifting subsidies that favor rice at the expense of other crops. For example, the Indian government usually buys rice from farmers at higher-than-market rates and then distributes the rice as food aid. This drives up rice consumption. When it is necessary for governments to intervene, these interventions should be more neutral with regard to which crop is used. This could happen through replacing rice subsidies and free rice with other income support for farmers and cash transfers to the poor.</p>



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<p>Farmers must be encouraged to choose the best crops for their local conditions. This could help many farmers in northwest India in switching from rice to wheat overnight, while monetary grants would allow India’s poor to have the freedom to choose a more balanced diet. These steps would correct a market that is currently skewed towards environmental harm, poor health outcomes, and malnutrition. The slow pace of adoption of agricultural improvements by farmers can be partially explained by these generous subsidies which shield farmers from the rice crisis. It would be in the interest of all—farmers, citizens, and the government—to pursue new directions beyond rice production.</p>



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<p><strong>In conclusion, the rice crisis reveals immense challenges that will require multiple pathways forward, and which indeed lead in contradictory directions. Policy makers must balance between complex economic and technological solutions to overcome the rice crisis. They must make their economic support contingent on the adoption of best practices through supporting crop insurance, which is a good approach in and of itself. They should also constantly provide reassurance to farmers who are transitioning towards more sustainable modern agricultural methods that are less damaging to the environment. This will ultimately help combat climate change and resolve a deepening crisis for one of the world’s most important foodstuffs.</strong><strong></strong></p>

      

How Can Governments Deal with the Global Rice Crisis?