The price of rice recently increased by 30% in a single day. But not everywhere. Places affected were in South East Asia, places like the Philippines and Indonesia, home to a new and desperate phenomenon rice suicides.
East Asia hasn’t, however, been affected. In China, the prices are barely up at all, and they’re lower than last year. This compares to a 200% increase in the Philippines over the same period. South Korea is opening its grain reserves to keep prices down. Japan isn’t suffering at all, by the sound of things.
What distinguishes all three of these countries from others in Asia? First, they have their own domestic production. Second, they augment domestic production with domestic grain reserves. Third, they’re only able to do this because they’re aggressive and powerful negotiators in international trade agreements. Japan has long held that its rice isn’t just a commodity but a way of life.
The political commitment to sustain this way of life, in China, South Korea and Japan, using some Old School economic policy (subsidies, protection, grain reserves) means that in the lean times, these countries will be able to survive. That’s great for them – there’s no indication that the lean times are going to end any time soon. And it’s tough for the weaker countries in Asia, who find themselves cut loose, in the perfect storm that the free market has produced.
Thanks to Irene Lin at the National Family Farm Coalition for these links.