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Thailand floats idea of OPEC-style rice cartel


By Ambika Ahuja, AP
Saturday, May 3, 2008


    

Vichienchot, the Thai government spokesman, confirmed that Prime Minister Samak Sundaravej brought u

p the idea of a grouping modeled after OPEC during his discussions Wednesday with Myanmar's Prime Minister Lt. Gen. Thein Sein in Bangkok.

"The idea is that we can work together to improve yields and production and have some influence on setting the prices, making it a little more balanced," Vichienchot said.

Samak said Wednesday Myanmar supported the idea, while officials in Vietnam have said they are studying it and could possibly support it.

Much like the Organization of Petroleum Exporting Countries sets oil prices, the tentatively named Organization of Rice Exporting Countries would help set prices for rice. Supporters say that would ensure farmers benefit from the increasing demand for the staple.

Robert Zeigler, director general of the International Rice Research Institute in the Philippines, said he expected it would be difficult to apply the OPEC model to rice.

"Rice is grown by millions of farmers in one, two, three hectares of land. Oil is produced by a few multinational companies in a few countries," Zeigler said. "So I think the differences are so large as to make any comparison between the two wild fantasies."

Chookiat Ophaswongse, president of the Thai Rice Exporters Association, said he was against the idea of a cartel. He said it would have difficulty swaying world markets because such a grouping would still exclude big producers like India and Pakistan and would find it difficult to control farmers producing rice on a seasonal basis.

"When there is a crisis with rice, they (the government) talks about this cartel. It has never happened and I don't think it will," Chookiat said. "You cannot control farmers growing or not growing rice. It's not like oil," which even if isn't pumped out of the ground is still there.


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Thailand floats idea of OPEC-style rice cartel

A Thai farmer plows his flooded rice field for a second cropping in Ayutthaya province, central Thailand in this May 4, 2006 photo. Thailand, the world’s biggest rice exporter, is talking of forming an OPEC-style cartel with four of its Southeast Asian neighbors so that it has more control over the prices which have tripled this year.(AP)

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