Friday, April 18, 2008

Potatoes as rice alternative

International rice prices have hit past $1,000/ton already yesterday, a historic high, and the trend is towards even higher price in the next few months. The Philippines – now the world’s biggest rice importer – is particularly at a disadvantage. With this situation, there are 2 major choices: bear the higher price and scrimp or save on viands and other household expenses, or shift to other rice alternatives – like potatoes.

Potatoes are more versatile than rice because they can be grown at any climate, from the hot tropics to the cold temperate continents, and at any elevation. Unlike rice, potatoes require very little water and they can mature in less than 2 months, whereas the short-duration rice varieties will mature in 3 months.

In addition, average yield for potatoes is at least twice that of rice. Potato farmers do not need threshers and millers; the product can be cooked and consumed without any laborious and complicated processing. And potatoes are rich in certain healthy substances like complex carbohydrates.

A number of the indigenous people in the Philippines like the Aetas eat sweet potato (locally known as ‘kamote’) more than rice. Well, they don’t have threshers and rice milling (facilities) in the mountains, so manual threshing and milling to extract rice from palay (unhusked rice) is another labor-intensive work, on top of rice planting, growing and harvesting work.

There are a number of problems and disadvantages in potatoes though, compared to rice. One is transportation: potatoes are heavy and may rot during transit. Second, raw potatoes cannot be stored for long in warehouses or stockrooms that are not refrigerated, unlike rice that can be stored for several months in one’s kitchen at normal temperature.

Commercial potato traders can take care of the storage problem. The never-ending spikes in rice prices will surely push some people to slowly shift to potatoes, where there are several hundreds if not thousands, of different varieties.

When people do this, especially the poor, governments need not create new bodies like a ‘Potato Development Authority’ because this might distort the incentive system between producers and consumers. The latter will always look for food products that can satisfy their hunger and nutritional needs at affordable prices, whether these are rice or cassava, bananas or potatoes. And producers and traders respond to the changing taste and preferences of consumers.

At no other time in modern agricultural history, more people now should be in productive food production, trading and processing work, and less on unproductive regulatory work. That’s the only way if we are to expand food production, avoid hunger and the social ills associated with it.

Thursday, April 03, 2008

High rice prices, why

The cheap rice that the Philippines usually imports from Thailand, Vietnam, other Asian countries, to my understanding, is the Thai rice 25% broken. About 4 years ago, its price was only around $165/ton. This week, it's $604/ton. The rise in rice prices became very pronounced in the first quarter of this year, and it looks to be continuing into the second quarter.

A friend from Jordan, Sufian, asked me what are the problems that affect high rice prices.

I have discussed that in my previous posting here. But quickly, high rice prices in the world today is caused by a combination of high demand (more people are shifting to rice, high population growth, etc.) and low supply (some rice lands were planted with corn or other bio-fuel crops, there were pest attack elsewhere, low rainfall and irrigation, etc.).

The role of some opportunist traders who manipulate rice prices by hoarding and hiding some rice supply is also a factor.

There are many other factors, both macro and micro. But the above will greatly explain the current phenomenon.

The rains of summer

While the Philippines (and other tropical countries) experienced prolonged dry season last year – regular rains came last August, instead of June – the country also has prolonged rainy season this year. Regular rains normally stop by end-November, but we still had rains until February. The “cold front” brought about by winds from Siberia and China lasted until the second week of March this year. By mid-March, it was obviously summer as the cold wind was gone and we had less cloud in the sky.

Almost coinciding with the formal onset of summer, was the rapid spike in rice and other food prices here and abroad. Stories about rice importation, inspection of some rice traders, corruption charges of “missing rice” from the government’s National Food Authority (NFA), even reference to “rice crisis”, are in media everyday.

So when thick clouds form in the sky, it is a big respite for us. And when it rains, even briefly, it’s a bonus. Because the rains cool not only our hot roads, hot environment, hot temper, but the rains also help irrigate the few rice farms. The “La Nina” phenomenon should be responsible for those brief but much needed rain showers.

At this time of the year, especially in the northern provinces of the country, majority of rice fields are on fallow and they become pasture areas for the cattle which cannot find young grasses around. Other rice fields are planted with corn as the price of this crop has also risen recently. I have noticed an increase in corn plantation this year compared to last year and the previousa years, at least in the province of Pangasinan.

The dry season of summer should be an opportunity for people and farmers to improve and repair old irrigation canals and dams, and/or build new ones. In our farm for instance, if we can raise the water level in our short irrigation canal by about 1 meter, nearly 1 hectare of additional, relatively flat land on the other side of the creek can be planted with rice or other crops. We use hoses to transport the impounded water on one side of the creek to the other side.

If people will become more self-reliant and depend less on government hand-outs and projects, say in repairing and/or building new irrigation canals and small water impounding structures, they should be able to improve their rice harvest (or other crops) in the next planting season just a few months away from now.