Corn, rice prices surge as global food tensions mount

With poorer nations struggling to find supplies, the Asian Development Bank criticized rice export bans, saying governments should instead use fiscal measures to help the poor.

“Banning of exports is no different from hoarding at a national level,” Rajat Nag, the ADB’s managing director general, told reporters at Singapore’s Foreign Correspondents Association.

The price of rice from Thailand, the world’s No. 1 exporter, has more than doubled this year. The benchmark Thai 100 percent B grade white rice was quoted at a historic high at US$950 a tonne this week RICE/ASIA1, up from US$383 earlier this year.

Corn futures also rose as wet weather slowed the pace of American corn planting. The U.S. Department of Agriculture said American farmers had planted only 4 percent of the corn crop, well below the average seeding rates of nearly 20 percent.

Chicago corn for May delivery jumped 14 cents per bushel to US$5.94 per bushel.

“Corn is purely up on the planting progress report of only 4 percent — the last time we saw that was 1993, and that was a flood year,” said Terry Reilly, analyst for Citigroup.

Many farmers were not able to plant corn in 1993, because of excessive rainfall and flooding in major crop areas adjoining the Mississippi River. It is not likely that will happen this season, but the current wet weather and forecasts for more rain are beginning to worry the corn market.

In Brazil, Inter-American Development Bank senior advisor Nathaniel Jackson said the bank was concerned about diversion of staple foods to biofuels and would not fund projects to produce ethanol from corn.

While the bank remained interested in biofuels made from soy and sugar cane, it preferred to finance plants like jatropha, which are non-edible and require no arable land, he said.

In Argentina, talks between the government and farm leaders grew more tense, raising expectations in financial markets that farmers resume a strike over a tax hike on soy exports. Soy futures at the Chicago Board of Trade closed up, partly on perceptions that the truce in Argentina could break.

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