The United Nations Must Manage a Global Food Reserve

More than half of the world's 6 billion people eat rice as their staple food. Global rice prices have been rising since early 2003. Moderate increases of 9 per cent in 2006 and 17 per cent in 2007 were recorded, but since the beginning of 2008 international rice prices have shown a steep upward trend, reflecting a limited supply available for purchase.1 In March 2008, the high quality Thai 100 per cent B (white rice) was quoted at $562 per tonne, which was 74 per cent higher than in March 2007, and rose to $898 per tonne by mid-May 2008. Likewise, Thai A1 Super, fully broken rice, markedly increased by 94 per cent, from $263 per tonne in March 2007 to $522 in March 2008 and surged to $764 per tonne two months later. By May 2008, world rice prices were more than double their May 2007 level.

Hardest hit by this spike in prices are major rice-importing countries, especially the Philippines, the world's top rice importer. The increase in prices worldwide also drove up domestic rice prices, which rose from March 2007 to March 2008 by 100 per cent in Bangladesh and Cambodia, 70 per cent in Afghanistan, 55 per cent in Sri Lanka and 40 per cent in the Philippines.2 Only 6 to 7 per cent of global rice production is traded internationally each year.1 Due to a very thin market, the price of rice has been subject to the sharpest fluctuations among the world's traded staples.

The rice crisis resulting from soaring prices and tight supplies has serious implications. Rice provides 60 per cent of the food intake in Southeast Asia and about 35 per cent in East and South Asia. The International Rice Research Institute reports that 700 million, or two thirds of the world's 1.1 billion poor, live in rice-growing countries in Asia. These people spend as much as 30 to 40 per cent of their income on rice alone. The poor are, therefore, vulnerable to the surge in rice prices since their purchasing power will be seriously hit, resulting in severe food deprivation and malnutrition.2 In recent months, the rice crisis has resulted in social unrest, with mass protests and food riots in several countries.3

In this paper, we examine the underlying causes of the recent rice crisis and assess the effectiveness of the Association of Southeast Asian Nations (ASEAN) Emergency Rice Reserve, the East Asia Emergency Rice Reserve, and the South Asian Association for Regional Cooperation (SAARC) Food Security Reserve in addressing past and present world rice crises. In addition, we provide some recommendations for a global food reserve as an alternative to the existing regional rice reserves. We also suggest measures to improve rice productivity in rice-producing countries, strengthen market information in order to increase stocks, and better determine the production capacity and demand for each participating country and their consequent contribution to the global food reserve.

Underlying causes of the rice crisis
The six-year global surge in international market prices of rice is largely due to declining global rice stocks, as world consumption has outpaced production. For the past 10 years the annual world rice consumption grew faster, at a little over 2 per cent, than the annual rice production rate at 1.07 per cent (Table 1). As a result, rice stocks have fallen by 12 per cent, from 119 million tonnes in 2003 to 104.5 million tonnes in 2007 (Table 2). Based on forecasts by the Food and Agriculture Organization of the United Nations (FAO), rice stocks in 2008 will further dwindle to 103.5 million tonnes, implying that global demand will further outpace production. Currently, China holds about half of the world's rice stocks.

The effects of climate change
Many factors have caused the imbalance between the demand and supply of rice. On the supply side, a number of distinct weather and climate-related incidents have caused disruptions in rice production in some countries. The extended drought in Australia over the last four years caused the annual rice harvest to fall by as much as 98 per cent from pre-drought levels. Cyclone Nargis in Myanmar in May 2008 ruined large rice paddies with salt water; major flooding in Bangladesh in 2007, strong typhoons in the Philippines from 2006 to 2008, cold weather in Viet Nam, and widespread drought in India and China in 2002 also led to lower yields. Moreover, since 2005, the shortfall in world rice production has been aggravated by the reoccurrence of pests and diseases during the growing season. In China, Indonesia, the Republic of Korea, Japan and Viet Nam, abnormally high temperatures and excessive use of broad spectrum, residual insecticides, which disrupt natural pest defence mechanisms, also contributed to the decline in rice production. In Viet Nam alone, pests have wiped out as much as 200,000 tonnes of rice.

Another major reason for the continuing imbalance in the demand and supply of rice is the slow growth in rice yield, which was less than 1 per cent for the past 10 years in Asia and worldwide (Table 1). In China -- the world's top rice-producing country -- and Myanmar, rice yields have decreased over the past 10 years at an average of 0.10 and 0.73 per cent, respectively. In Japan, rice yields have flattened in the same period, as evident from its average annual growth in rice yield of only 0.29 per cent. Thailand -- the world's top rice exporter -- registered a lower annual growth rate of 1.38 per cent compared to that of the Philippines -- the top rice importer -- at 3.48 per cent annually. In 2007, Thailand's rice yield of 2.71 tonnes per hectare was also lower compared to the 3.86 tonnes per hectare of the Philippines. However, Thailand's total rice area of 10,430 hectares was 2.5 times larger than that of the Philippines at 4,250 hectares in the same year.

Decreasing investment in agriculture
Another key reason for limited rice yields is a decline of investments in rice research and development and major agricultural infrastructure in many rice-producing countries. As reported by the International Rice Research Institute, international donors have not provided sufficient support for agricultural research and development. Without significant external assistance, this problem is made worse as lack of capital prevents many governments from supporting research and development and maintaining irrigation facilities. This is shown by the lower average annual growth rate of 3.9 per cent in public investments in agriculture in Asia in the 1990s as compared to 4.3 per cent annually in the 1980s. In 2000, only 0.4 per cent of the agricultural gross domestic product was spent on research and development in Asian countries, compared to 0.53 per cent in developing countries as a whole and 2.36 per cent in developed countries.5
Moreover, the production of rice is more expensive now because of higher fertilizer, fuel and power costs. With the introduction of high-yielding rice varieties that require non-organic fertilizers and irrigation as essential inputs, world rice production has become more energy-intensive.

High energy prices
A 2008 Asian Development Bank study reveals that world energy prices have increased rapidly in the years 2002/07, with oil prices rising by about $10 per barrel annually in nominal terms. Despite large subsidies in Asian countries, domestic energy prices were high, at 20 to 50 per cent, while increases in fertilizer, irrigation and transportation costs ranged from 30 to 50 per cent. A World Bank-funded study6 also notes that rising energy and fertilizer prices and the depreciation of the US dollar have contributed to about 35 per cent of the rise in food prices. In the Philippines, the 24 per cent increase in the farm-gate price of paddy and the wholesale price of milled rice from January 2006 to March 2008 was largely attributed to the 17 per cent increase in the cost of urea fertilizer. This shows that the soaring price of fertilizer has contributed to inflationary pressure on food prices.

Losing rice lands
Another reason for the slow growth in world rice production is due to the conversion of rice lands to industrial and residential use in many rice-producing countries. Thus, rice area expanded by only 0.22 per cent globally and 0.21 per cent in Asia over the past 10 years (Table 1). Countries such as Japan, China and Viet Nam have reduced the land previously used for rice production by 1.5 per cent, 0.67 per cent and 0.03 per cent, respectively, as they underwent rapid urbanization and industrialization. China lost 8.8 million hectares in the last 10 years; similarly, Australia's rice acreage has plummeted to 15,000 acres, after having been as high as 310,000 acres.7 On the other hand, growth rates in rice areas in Brazil, India, Indonesia and Thailand during the same period were less than 1 per cent, reflecting limited agricultural lands for growing more rice. Although the Philippines registered a 2 per cent growth in rice area since 1997, it lost nearly half of its irrigated lands to rapid urban development in the past 20 years.

On the demand side, population growth, together with increasing demand but limited production in Africa and the Middle East, contributed to the imbalance in the global demand and supply of rice and its surge in price. The world's population has grown annually at a rate of 1.14 per cent since 1997, leading to a sharp yearly increase in global rice consumption of 2.05 per cent (Table 1). World consumption rose from 420 million tonnes in 2005 to 435.7 million tonnes two years later -- an increase of 3.7 per cent (Table 2). FAO estimates that globally the demand for rice is increasing by around 5 million tonnes each year.

Africa led the sharpest rise in world rice consumption during the last decade at 3.92 per cent annually, compared with 1.01 per cent in Asia. Rice consumption in both continents exceeded rice production. According to FAO, although Africa's population is only 13 per cent of the world population, it accounts for almost one third of all the world's rice imports. Specifically, 40 per cent of the demand for rice in sub-Saharan Africa was met by imports, while in West Africa demand was as high as 67 per cent.

Among the rice-producing countries that showed the fastest growth in population and rice consumption over the last 10 years are Bangladesh, Indonesia, the Philippines and Viet Nam. In contrast, China and Japan showed negative growth rates in rice consumption and miniscule annual growth rates in population over the same period (i.e. 0.05 per cent in Japan and 0.58 per cent in China). Apart from slow population growth, another important factor that influenced rice consumption in these countries is increase in income, as people are reportedly switching to meat and dairy products.

Export bans and unintended consequences
To contain the rising domestic prices of staple foods, avoid civil unrest and ensure the availability of rice for domestic consumption, important rice-exporting countries such as Cambodia, China, Egypt, India, Pakistan and Viet Nam imposed strict export bans, taxes, ceilings or premium pricing on rice starting October 2007. Even traditional rice importers like Brazil and Ecuador protected their domestic rice reserves. Indonesia levied a new tax on its rice exports to discourage exports. Among the leading rice exporters, only Thailand and the United States exported rice without any constraints; although both countries only produce 6 per cent of the global rice harvest, they account for about 45 per cent of the world's rice exports.8

With export bans, world rice exports dropped from 31 million tonnes in 2006 to 28.7 million tonnes in 2007 (Table 2). Given the thin market for rice trade, with only a limited number of countries exporting, recent measures to limit international sales have caused strong disruptions in the normal pattern of trade, restricted global rice supplies and triggered price surges. According to FAO, tighter rice supply resulted in greater contract defaults by exporters. Two rice suppliers in Cambodia, for instance, defaulted on contracts with the World Food Programme since they claimed that the new higher prices would offset any penalty for reneging on the contract.

The top importing countries -- Bangladesh, Nigeria and the Philippines -- have been hit hard by the soaring rice prices partly caused by export restrictions imposed by certain rice-producing countries. The Philippines imports about 15 per cent of its total rice supply. Moreover, hoarding -- as a result of price speculation in some rice-producing countries -- restricted domestic supply and pushed up prices. In Thailand, rice millers defaulted on supply contracts with exporters to take advantage of higher prices.

Biofuel demand
Owing to high prices of oil in recent years and concerns of diesel and/or petroleum-based pollution in transport facilities, governments in both developed and developing countries are rapidly investing in alternative energy sources, such as ethanol from sugar cane, corn, cassava and sweet sorghum, or biodiesel from coconut and palm oil. The shift from food crops to cash crops with lucrative markets in terms of land use has further exacerbated the food crisis. However, studies have shown that the impact of this shift should not affect rice prices since rice is not used for biofuel production, compared with other grains or oilseeds, and rice land cannot easily be converted to grow other biofuel crops.5 Nevertheless, the increase in wheat prices is being reflected in rice prices, considering that wheat and rice are substitutes in consumption and imports.

The need for multilateral cooperation
Tight rice supplies have led affected countries to adopt short-term measures to stabilize prices. These include restricting rice exports, increasing food handouts, extending consumer subsidies, maintaining price controls and criminalizing the hoarding of food. Despite these efforts, the severity of the rice crisis renders national action inadequate and requires multilateral cooperation.
The establishment of a regional or global food reserve as a long-term measure would serve to stabilize extreme rice price fluctuations in the international market. Regional or global food reserves refer to quantities of rice and other food grains (i.e. wheat and corn) accumulated through donations or purchases from major rice-producing countries for distribution in times of shortage to other members that may experience a deficit in supply brought about by famine, strong typhoons and pest and disease infestations. The food reserve would be accumulated during periods of bountiful harvest and low prices, and made available to food-deficit countries, cushioning them from surging rice prices.

Regional food reserves: How did they fare?
Rice is the most important staple crop in Asia. In 2007, about 91 per cent of the world rice production and 76 per cent of rice exports came from Asia.8 Hence, success in the implementation of any regional food reserve scheme in the region hinges to a large extent on strong multilateral cooperation among regional countries.

Three emergency rice reserve schemes implemented in Asia are the ASEAN Emergency Rice Reserve (AERR), the East Asia Emergency Rice Reserve (EAERR), and the South Asian Association for Regional Cooperation (SAARC) Food Security Reserve.

ASEAN Emergency Rice Reserve
The reserve was established as part of the ASEAN Food Security Reserve Agreement, signed by the ASEAN foreign ministers in 1979. Under the agreement, the five original ASEAN member countries (Indonesia, Malaysia, Philippines, Singapore and Thailand) made a commitment to voluntarily pool rice into a common regional stockpile, with the main objective of meeting emergency requirements from extreme and unexpected natural or man-made calamities. The agreement was not intended to fill continuing deficits of individual member countries which were usually met through imports. The total initial rice reserve was 50,000 tonnes, with Thailand contributing 15,000 tonnes, Indonesia 12,000 tonnes, the Philippines 12,000 tonnes, Malaysia 6,000 tonnes and Singapore 5,000 tonnes. When Brunei Darussalam and Viet Nam joined ASEAN, contributing 3,000 tonnes and 14,000 tonnes respectively, the reserve ballooned to 67,000 tonnes in 1997. However, in spite of its more than 27 years of existence, the reserve did not increase significantly, reaching only 87,000 tonnes. In fact, it was not even enough to meet a half-day ration for the rice-consuming populations of the ten ASEAN member countries.9

Considering that the ASEAN emergency rice reserve has never been operationalized, and since the small stock could not meet the emergency needs, a study team supported by the Japan International Cooperation Agency reviewed the situation. The team recommended that a three-year pilot East Asia emergency rice reserve be implemented along the lines of the ASEAN emergency rice reserve.

East Asia Emergency Rice Reserve
The reserve, approved in 2003, is a regional cooperation mechanism among ASEAN countries as well as China, Japan and the Republic of Korea (the ASEAN Plus 3). The three-year pilot project began operations in March 2004 and was extended until March 2008. Although the East Asia emergency rice reserve largely ran along the lines of the ASEAN model, it underwent some structural and operational changes (Table 3). Compared to the ASEAN emergency rice reserve, it adopted measures to ensure food security within the region and strengthen rice trade linkages among member countries and the world.

The East Asia emergency rice reserve also includes a detailed mechanism on the release of its stocks and rice distribution in times of emergency under different programmes and schemes, namely, commercial trade in times of emergency; food aid in emergency or long-term loan; and poverty alleviation. Apart from its objective for food security, it is also geared towards intra and inter-regional trade and in fostering competitiveness of member countries through technology transfer, regional cooperation and private-sector participation.9 Furthermore, the East Asia emergency rice reserve addresses the supply gap during emergency and normal situations and maintains physical stocks rather than earmarked stocks.

Under the East Asia scheme, each ASEAN Plus 3 member country pledges a specific amount of rice and contributes to the emergency stockpile. One of the advantages of this scheme over the ASEAN model is a management team that assesses deficit or surplus conditions in member countries and transfers stockpiles between countries during a food emergency.10 In times of emergency, the management team could dip into the rice reserve of one country and transfer it to another experiencing disaster and whose emergency requirement exceeds its earmarked reserve. Transportation and operational costs, however, would be shouldered by the country in need.

How they compare
Both schemes also differ in terms of supervision and coordination. Under the ASEAN emergency rice reserve, there was no principal responsibility assigned to a specific member country to coordinate the scheme. Instead, the chair of the ASEAN Food Security Reserve Board was rotated among its member countries. Since there was no specific budget allocated to the ASEAN emergency rice reserve, member countries such as Brunei Darussalam, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Viet Nam pledged voluntary rice contributions. In contrast to the ASEAN scheme, the East Asian emergency rice reserve pilot project was implemented with a coordinator, Japan, that also provided a budget: 40 million yen or $380,000 to bankroll the Secretariat's expenses in 2004/05.9 In addition, Thailand gave in-kind contributions. With Japan playing the principal role and providing the financial resources, it has been anticipated that processes and mechanisms would be adopted to implement the revised model of regional emergency reserve, with concrete results. Rice trade linkages were expected to flourish among member countries and with the rest of the world.
Although both schemes emphasize fostering rice trade, initiatives to improve rice productivity in ASEAN member countries that perennially experience rice shortages are lacking under the ASEAN scheme. However, the East Asian emergency rice reserve recognizes that interventions should be geared towards technology transfer, and more investment should be made in agriculture to improve rice productivity and international competitiveness.

How successful have these two schemes been? Due to the insignificant volume of rice reserves, the ASEAN emergency rice reserve was not successful in meeting food emergencies in the Southeast Asian region. Considering that the rice reserve could only be tapped in an emergency, member countries did not utilize it, perhaps because admission of a food emergency by any government might cause domestic unrest and weaken the country's political situation in the region.9 This was exemplified by the serious rice shortage in Indonesia in 1997, when instead of tapping the emergency rice reserve, the government took loans from multilateral financial institutions, such as the International Monetary Fund and the World Bank, to import food from other countries like Thailand and Viet Nam. Moreover, the bilateral nature of the mechanism for processing requests for earmarked rice stocks meant leaving the terms and price of the transaction at the mercy of the supplier country. A country experiencing rice deficit may be put at the mercy of its more powerful rice surplus neighbour, since ASEAN did not play any role in the trade negotiations.
Meanwhile, the East Asia emergency rice reserve appears to be more beneficial to Japan and Thailand, which have strongly pushed for its adoption. The rest of the member countries joined in the pilot phase, largely out of diplomacy and to maximize the resources made available by Japan. For Thailand, being one of the world's top rice exporters, the East Asia reserve is a potential market for its rice exports, given the stiff competition in the world market. For Japan, on the other hand, the scheme is one way of safeguarding its domestic rice market because of its obligations to the World Trade Organization (WTO). Holding a considerable stock of imported rice in its market will adversely affect Japan's rice farmers, but the East Asia reserve will enable Japan to have a second supply of rice whenever demand rises in its domestic market while at the same time complying with its WTO commitment.

SAARC Food Security Reserve
Also modeled after the ASEAN emergency rice reserve is the South Asian Association for Regional Cooperation Food Security Reserve. It came into effect in 1988 to meet emergencies in its then member countries: Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka. The reserve stood at 241,580 tonnes of rice and wheat.

The SAARC Food Security Reserve Board, comprised of representatives from member countries, is responsible for a periodic review and assessment of the food situation in the region, including the production, consumption, trade, prices, quality and stocks of food grains. The board meets once a year to assess the general food situation in South Asia and the rest of the world.

Considering that the SAARC reserve was similar to that of the ASEAN emergency rice reserve, it encountered the same problems. One of the problems was that in times of emergency, bilateral cooperation prevailed over regional cooperation. For instance, in 2006, India supported Sri Lanka and Bangladesh to tide over shortages.11 Another inadequacy is the non-utilization of the reserve despite the fact that some member countries suffered food emergencies.12 The main reason why this scheme was not functioning well was its complicated process and difficult operating conditions. One of the main conditions to utilize the food grains from the SAARC reserve was for a member country to declare a national emergency, but no government was willing to do so in order to use food grains from the reserve.

To overcome the inadequacies of the SAARC food security reserve and improve its performance, member countries finalized an agreement in 2007 at the 14th SAARC Summit to establish the SAARC food bank for long-term food security and agricultural development. That year, Afghanistan joined as the newest member. The scope of the SAARC food bank expanded beyond emergencies to act not only as a regional food security reserve for member countries during emergencies, but also to provide regional support to national food security efforts, foster regional integration and solve regional food shortages through collective action.12

The SAARC food bank proposed an initial rice and wheat reserve of 241,580 tonnes, with Bangladesh contributing 40,000 tonnes, Bhutan 180 tonnes, India 153,200 tonnes, the Maldives 200 tonnes, Nepal 4,000 tonnes, Pakistan 40,000 tonnes and Sri Lanka 4,000 tonnes. Afghanistan's share will be determined later. In addition to any national reserve, the stockpiles would remain the property of the individual member country. The food grains will remain in the respective storage facilities of member nations.13 Whenever a SAARC country faces food shortages, it can take food grain from its own designated storage facility to cope with an emergency crisis. If the food grain is not sufficient to meet its demand, the country will have access to a loan for more food grain from its neighbouring SAARC country's designated storage facility. The member country using the food grain from the SAARC food bank will not have to pay anything but will be required to return the food grain to the storage facility after the crisis has ended.

Moreover, the SAARC agreement contains broad principles for determining the price of food grains and the terms and conditions of payment.12 They will be based on direct negotiations between the concerned member countries using the guidelines for price determination, as approved periodically by the SAARC food bank board. The SAARC agreement aims to rationalize and improve the provisions on the procedures for withdrawal and release of food grains. It delineates the role of the SAARC board in administering the food bank. Emphasis will be on multinational cooperation instead of bilateral arrangements, and private-sector participation will be encouraged.

Presently, the proposed SAARC food bank is not yet fully operational, since only Bangladesh, India, Pakistan and Sri Lanka so far have ratified the declaration for its establishment. Its implementation will involve the construction of new food warehouses in member countries, local procurement and international purchase of additional food grains and also the development of an administrative and distribution network.

A United Nations-managed global food reserve
Owing to the limitations of the ASEAN, East Asia and SAARC food security reserves, we recommend that a global food reserve be established. Unlike the three existing reserve schemes, which focused on the use of reserves exclusively for emergency responses and humanitarian assistance but failed to include price stabilization as one of its major objectives, the proposed global food reserve would have a two-pronged objective. First, to stabilize food prices, especially rice, in the world market by using the stockpile to defend a price band (i.e. lower and upper limits); and second, to provide immediate assistance to countries encountering calamities. When prices are falling, the low end of the price band would serve as a safety net for farmers in exporting countries. Conversely, the high end would protect consumers in food-deficit or importing countries from the adverse effects of high food prices in the world market.

The World Food Programme (WFP) is the appropriate body to manage the proposed global food reserve given its proven record in administering similar food stockpiles. Moreover, WFP has been actively involved in providing food security support to Least Developed Countries, which have a high proportion of vulnerable and poverty-stricken populations. The stockpile could initially start with rice and later expand to other food grains, such as wheat and corn. To support WFP in its management of the scheme, we further propose that a global intelligence unit be established, whose main role would be to provide advice on when the emergency stocks should be made accessible to WFP, and to design and implement a dynamic price-band system.14
The global food reserve would have three important features distinguishing it from the existing emergency rice reserves. First, physical stocks would be owned, controlled and managed by WFP, in contrast with the existing rice reserves, wherein participating countries still own and control pledged stocks for release in times of calamities and emergencies. Second, the establishment of transparent and non-discriminatory rules and regulations set by WFP would determine when countries can access the global food reserve. Thus, the problems related to bilateral negotiations under the existing schemes, resulting in disadvantages to importing countries, could be avoided. Third, the global food reserve would strategically locate the stocks either in or adjacent to calamity-prone countries. In the existing rice reserve schemes, there are no additional stocks in deficit countries that could be immediately available in times of emergency since the pledged stocks have been kept by participating nations in their respective countries.

Voluntary contributions such as cash, rice stocks or hosting services would establish the global food reserve. Expenses incurred by a host country for storage, maintenance, replenishment and management of the stocks could be considered as contribution to the global food reserve scheme. WFP may also buy, sell, lend and accept deposits of rice stocks under this new scheme.

Increasing rice productivity: The proposed global food reserve must be sustainable. One way to do this is by narrowing the supply/demand gaps in many deficit countries through increased food productivity. As it is quite difficult to expand rice land because of rapid urbanization, industrialization or land conversion to other crops, the total rice area is unlikely to increase. The main source of additional production will then come from increases in yield. Increasing growth through productivity requires a long-term solution, which has to be achieved to avoid famine and mass starvation.

According to the International Rice Research Institute,15 there is a gap between the potential and the actual yield of rice. Depending on land conditions, there is an unexploited yield gap of 1 to 2 tonnes per hectare in most rice fields in Asia. That gap can be reduced through more investments in research and development to develop high-yielding varieties that are tolerant to pests, typhoons or drought, which is the main problem in Africa and some parts of Asia, such as Australia.

Pests like plant hoppers and the various diseases transmitted by them, such as tungro, were a major threat to the rice intensification programmes of the 1970s and 1980s. Today, the pests have returned as major threats to production, primarily due to the breakdown in crop resistance and the excessive use of broad-spectrum, long-residual insecticides that disrupt natural pest control mechanisms. Since 2005, plant hopper outbreaks have affected several million hectares in China, Indonesia, Japan, the Republic of Korea and Viet Nam, particularly during the harvest season, and the pests are becoming increasingly problematic because of climate change. In Viet Nam, plant hopper and virus outbreaks were major reasons behind the government's decision to restrict rice exports. Thus, official funding for the development of new, durable and high-yield rice varieties must be pursued relentlessly.

Training young scientists: A corollary to this must be the education and training of young scientists and researchers from rice-producing countries. There is a need to train new scientists and researchers before the present generation retires. Governments of rice-producing countries must give due attention to attract the young to pursue a career in this field. This is critical in light of the increasing migration of the younger generation to urban areas and an increasing shift from agriculture-related work to non-agriculture types of employment in many countries throughout Asia.

Investment in irrigation: Investments in irrigation systems, which peaked during the Green Revolution in the 1970s and 1980s, have decreased substantially over succeeding years in several rice-producing countries. Existing irrigation infrastructure has deteriorated considerably because of poor maintenance brought about by limited government allocations. In this regard, there is a need to increase investments in irrigation systems to improve efficiency and reliability of water supplies necessary for crop productivity and minimize crop failures.

According to the Asian Development Bank, investments should focus more on rehabilitation or repair of existing irrigation systems rather than the construction of new and large-scale facilities. Together with irrigation development, additional investments in flood control and drainage systems will also be needed for soil and water conservation. Moreover, investments in roads, bridges and market facilities are equally important for boosting and sustaining productivity in rice and for easing the movement of raw material and produce. Funding support is likewise required to deepen the farmer's knowledge and skills in land preparation, water and nutrient management, and control of pests and diseases. The provision of efficient and cost-effective technologies that will increase productivity can only be achieved if these are complemented with appropriate cultural management practices. Training of stakeholders and extension services such as field demonstrations will help.

Caring for the harvest: Upgrading of post-harvest facilities, coupled with improvement in post-harvest handling and processing of grains, would increase domestic production by reducing wastage, produce better quality crops and generate employment. Most farmers in Asia suffer considerable losses in terms of both quality and quantity of rice during post-harvest operations because of the use of old and inefficient drying and storage technologies. According to the Bureau of Postharvest Research and Extension in the Philippines,16 post-harvest rice losses were as high as 33 per cent of the total production. In general, 21 per cent of rice was lost in the drying operation, 30 per cent in milling, 18 per cent in storage and 15 per cent in threshing.17 Limiting these losses would mean more rice for the growing population. Hence, budgetary support for the provision, repair and maintenance of dryers, storage and milling facilities is deemed urgent to ensure food security. Concomitant to the provision of these facilities, is the extensive and continuous training of rice farmers and traders on appropriate post-harvest handling practices and technologies.

Incidentally, farmers continue to adopt traditional, low-yield rice varieties when in fact there are already new varieties that could boost their production. The problem lies in the inadequate extension services in Least Developed Countries, mainly because of fewer resources. Thus, there is a need for the creation of a seed fund which can be used to support some of the requirements of these countries in order to accelerate the introduction and adoption of higher yielding varieties.

Strengthen marketing information system: Effective implementation of the global food reserve requires an effective and efficient marketing information system. Although information technology has been introduced and adopted in many countries, a large number of farmers in developing countries still complain of a lack of access to reliable and timely market information. The type of information influencing farmers and other stakeholders in their production and marketing decisions include the status of domestic production and demand, current stocks, external trade, and prices of rice and other food crops.

Part of the activities in the proposed global food reserve is the estimation of the supply and demand situation of rice and other food crops on a regular basis to determine the size of stockpile to be held in the designated countries and the allocation to be given to least developed, poverty-stricken and import-dependent countries. Concerned agencies in developing countries should be assisted in setting up a good database and apply appropriate methods to estimate the current and future supply and demand situation of rice and other food crops. The Food and Agriculture Organization of the United Nations could provide the team of experts, as well as the hardware and software components, in upgrading the marketing information system. Participating countries could provide relevant and timely information to the proposed global intelligence unit that would advise the World Food Programme in determining the emergency food requirements in rice-deficit countries and surplus volumes in rice-surplus countries.

Notes 1 FAO, 2008. Crop Prospects and Food Situation. Rome; FAO, 2008. Food Outlook: Global Market Analysis, Rome, June.
2 ADB, 2008. Soaring Food Prices: Response to the Crisis. Philippines.
3 Vail, M., 2008. Grain Prices Soar Globally Leading to Food Riots.
4 USDA, 2007. Review of World Rice Markets, United States Department of Agriculture FAS-FG-11-07/ November.
5 Brahmbhatt, M. and L. Christiaensen, 2008. Rising Food Prices in East Asia: Challenges and Policy Options. World Bank.
6 Mitchell, D., 2008. A Note on Rising Food Prices. World Bank, mimeographed.
7 Robinson, E., 2008. Global Rice Ending Stocks Continue to Fall. Farm Press.
8 Workman, D., 2008. Top Rice Producing Countries. 12 April; Workman. D., 2008. Leading Rice Export Countries. 16 April.
9 Daño, E., 2006. ASEAN's Emergency Rice Reserve Schemes: Current Developments and Prospects for Engagement. Women in Action, No.3.
10 Daño, E. and E. Peria. Undated. Emergency or Expediency? A Study of Emergency Rice Reserve Schemes in Asia. A joint publication of AFA and AsiaDHRRA.
11 The Hindu, 2008. For a Food Secure Asia. 7 August.
12 SAARC, 2008. The SAARC Food Bank. August.
13 Daily Star, 2008. SAARC Food Bank in the Offing. 31 May.
14 Von Braun, J. and M. Torero, 2008. Physical and Virtual Food Reserves to Protect the Poor and Prevent Market Failure. International Forestry Resources and Institutions (IFRI) Policy Brief No. 004.
15 IRRI, 2008. The Rice Crisis: What Needs to be Done? International Rice Research Institute, Los Baños, Laguna, Philippines.
16 BPRE, 22 January 2005. (http://www.bpre.gov.ph)
17 Technical Education and Skills Development Authority (TESDA), January 2005. Labor Market/Intelligence Report (http://www.tesda.gov.ph/services1/labormarket2.asp.23)