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22-08-2023, 01:07 PM
PUBLISHED MON, AUG 21 20238:26 PM EDTUPDATED 4 HOURS AGO
Lee Ying Shan
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Rice prices surged to their highest in almost 12 years, after India’s rice export ban and adverse weather conditions dented production and supplies of Asia’s primary staple food, according to the UN’s food agency.
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Other than India, food inflation has been relatively tame in Asia so far this year.
......
most Asian countries will be able to withstand a supply shock in rice alone.
......
Moreover, this spike in rice prices is happening amidst widespread lower food prices. Food prices on the whole, according to the United Nations’ FAO food price index, have come down about 23% from a peak last March
......
Rice supplies in China were under threat after flood alert levels were raised for three provinces, which typically account for nearly a quarter of the country’s rice output. However, Tay pointed to the country’s rice stockpile, which minimally stands at eight months of its annual needs.
......
Morgan Stanley said elevated global food stocks, particularly in Asia, help insulate production volatility and minimize the economic impact from a consumer standpoint.
Consequently, the U.S.-based investment bank expects volatility around El Niño to first manifest through inflation, and then through net trade balances.
This is particularly because food accounts for a large share — about 30% to 40% — of the consumer price index basket for most of emerging Asia.
......
“The lags differ across countries but, on average, we find a six-month lag between global food price inflation and CPI food inflation in Asia,” Nomura’s economists Sonal Varma and Si Ying Toh wrote in a note dated Aug. 11.
......
This means any spikes in food prices will only translate to food inflation toward the end of this year or early 2024.
Nomura identified the Philippines as the country “most vulnerable” to a surge in food prices, due to the high share of food in its consumer price inflation basket at 34.8% — rice alone accounts for 8.9% of its basket.
More at: https://www.cnbc.com/2023/08/22/asia-foo...surge.html
Lee Ying Shan
......
Rice prices surged to their highest in almost 12 years, after India’s rice export ban and adverse weather conditions dented production and supplies of Asia’s primary staple food, according to the UN’s food agency.
......
Other than India, food inflation has been relatively tame in Asia so far this year.
......
most Asian countries will be able to withstand a supply shock in rice alone.
......
Moreover, this spike in rice prices is happening amidst widespread lower food prices. Food prices on the whole, according to the United Nations’ FAO food price index, have come down about 23% from a peak last March
......
Rice supplies in China were under threat after flood alert levels were raised for three provinces, which typically account for nearly a quarter of the country’s rice output. However, Tay pointed to the country’s rice stockpile, which minimally stands at eight months of its annual needs.
......
Morgan Stanley said elevated global food stocks, particularly in Asia, help insulate production volatility and minimize the economic impact from a consumer standpoint.
Consequently, the U.S.-based investment bank expects volatility around El Niño to first manifest through inflation, and then through net trade balances.
This is particularly because food accounts for a large share — about 30% to 40% — of the consumer price index basket for most of emerging Asia.
......
“The lags differ across countries but, on average, we find a six-month lag between global food price inflation and CPI food inflation in Asia,” Nomura’s economists Sonal Varma and Si Ying Toh wrote in a note dated Aug. 11.
......
This means any spikes in food prices will only translate to food inflation toward the end of this year or early 2024.
Nomura identified the Philippines as the country “most vulnerable” to a surge in food prices, due to the high share of food in its consumer price inflation basket at 34.8% — rice alone accounts for 8.9% of its basket.
More at: https://www.cnbc.com/2023/08/22/asia-foo...surge.html
