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Despite their current economic crisis, Indonesia is expected to import a near-record 3 million tons of rice in 1998. Drought reduced 1996/97 production to 48.5 million tons (rough basis), a 2.6 million ton decline from the previous year; and the 1997/98 crop was delayed 6 to 8 weeks and is forecast to fall to 47.7 million tons. Although Bulog (Badan Urugsan Logistik - - Indonesia's rice import monopoly) held large stocks last fall, the delayed harvest and continued heavy consumption have depleted supplies. To ensure availability and keep prices of this politically sensitive commodity stable, Bulog has contracted for nearly 2 million tons of imports from Asian suppliers. Shipments began arriving in December and are expected to continue through April. However, the reduced production outlook means additional quantities will likely be needed throughout the year.
As the third largest producer and consumer of rice in the world, even small shortfalls in the Indonesian crop can have a major impact on the world market. However, international supplies appear ample to meet the additional import demand. Global production (rough basis) in 1997/98 is forecast to increase by 5 million tons over last year, to a record 566 million tons. Traditional Asian exporters such as China, India, Thailand, and Vietnam are all expected to have large exportable supplies in 1998. As a result, 1998 world trade is forecast at 20.1 million tons, the second highest on record.
For more information on this topic, see the rice section of this circular.
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