Asia Grain Outlook on Friday: Governments aim for long-term self-sufficiency

 

 

Rattled by volatile farm product prices in recent years, Asian countries have begun mapping out policies to increase self-sufficiency amid fears that expensive imports could harm economic and social stability.

 

South Korea's Ministry for Food, Agriculture, Forestry and Fisheries told lawmakers Thursday it had decided to revise the self-sufficiency target set in 2007 for key farm products to better insulate the country from sudden rises in international prices, Asia Pulse reported.

 

The country will strive to increase production of wheat, beans, hay and products that can be used for animal feed, it said.

 

Net importers of agricultural products in Asia were hit hard in 2007-2008, when global food prices spiked amid historically low inventory levels.

 

Realizing that international trade may not fully guarantee food security and can be at an unbearable cost, Asian countries quickly decided to grow more themselves.

 

The Philippines drew up a rice self-sufficiency plan last year, aiming for 98% domestic reliance from 2010. Indonesia and Malaysia also said they would strive to reach a higher self-sufficiency ratio.

 

Whether these ambitious plans can eventually be realized within the time frames set by the governments remains to be seen, but the potential impact on global trade and the implications for large exporters are worth noticing, analysts said.

 

China's National Development and Reform Commission in a report released in November set the goal of raising its grain output to 550 million metric tonnes by 2020, 50 million tonnes more than in 2010, in order to be 95% self-sufficient.

 

"Wheat imports probably won't rebound to the high level you've seen earlier, and the imports will mostly be limited to high-quality wheat that China doesn't grow," said an official at a government-backed think tank earlier this week.

 

The country, traditionally a corn exporter, is no longer a major supplier of corn on the international market because the government now controls exports in light of rising demand for feedmeal in order to satisfy people's higher consumption of protein.