* Third biggest rice exporter Vietnam to curb sales
* Iraq looks to build strategic stocks of rice and wheat
* Russia exporting wheat as normal for now
(Adds quotes, background)
By Naveen Thukral and Maha El Dahan
SINGAPORE/DUBAI, March 26 (Reuters) - Global food security
concerns are mounting as some governments contemplate
restricting the flow of staple foods with around a fifth of the
world's population under lockdown to fight the widening
coronavirus pandemic.
Panic buying of household items and store cupboard staples
such as rice and flour has occurred in nearly every country hit
by the virus, which has infected over 470,000 people across 200
countries. Empty shelves in supermarkets have been common.
The erratic nature of consumer buying is stoking concern
that some governments are moving to stem the flow of food
staples to ensure their own populations have enough while supply
chains are disrupted by the pandemic. "If major exporters start keeping grains at home, it will
have the buyers really worried," said Phin Ziebell, agribusiness
economist at National Australia Bank. "It is panicking and not
rational, as fundamentally the world is well supplied with
food."
Vietnam, the third largest rice exporter, has already
restricted sales amid concerns over domestic availability.
"If Vietnam maintains the export ban we will suddenly have
about 10-15% less available supply in the world market in the
near term," one European rice trader said. "Africa especially
could face disruption from this."
India, the top global rice exporter, has just entered a
three-week lockdown that has brought several logistics channels
to a halt. Elsewhere, Russia's vegetable oil union has called for a
restriction in sunflower seed exports, and palm oil output has
slowed in the number two producer Malaysia. MARKET ON EDGE
Russia, Ukraine and Kazakhstan have so far been able to
maintain wheat exports after decent 2019 harvests, but
Russia-focused grain traders are nervous. "I am absolutely sure there will not be a harsh scenario -
like Russia leaving the market. But I think there is going to be
some soft scenario," a trader said on Thursday, referring to
wheat and other types of grain.
At the same time, some importers are trying to boost
strategic supplies while others are finding glitches in supply
chains.
In Egypt, the world's largest wheat buyer, there have been
delays in offloading Black Sea grain supplies from ships, with
paperwork slowed by office closures due to the virus.
"There are at least four cargoes, corn and wheat, for the
private market that I know have been delayed at the ports,"
Hesham Soliman, a private grain trader, said.
The cargos are all for the private sector and Egypt's
government has said it is well stocked with strategic supplies
for four months ahead.
Iraq has said it needs to import 1 million tonnes of wheat
and 250,000 tonnes of rice after a "crisis committee" advised
building up strategic food stocks, while Qatar is also signing
agreements to increase its reserves. However, most wheat buyers in Asia, led by the world's
second largest importer Indonesia, are covered for supplies
until June, traders said.
"As of now we have not seen any wheat importer rushing to
cover supplies more than the usual needs," said one trader in
Singapore at an international trading company which sells Black
Sea and U.S. wheat in Asia.
NO SHORTAGE
Combined global production of rice and wheat - the most
widely-traded food crops - is projected to be a record 1.26
billion tonnes this year, according to the United States
Department of Agriculture data.
That output tonnage should easily surpass total combined
consumption of those crops, and lead to a build in year-end
inventories to a record 469.4 million tonnes, USDA data shows.
However, those projections assume normal crop flows.
Prices for rice are already rising due to expectations of a
further squeeze on exports.
"It is a logistics issue. Vietnam has stopped exports, India
is in a lockdown and Thailand could declare similar measures,"
said a senior Singapore-based trader at one of world's top rice
traders.
Benchmark rice prices in Thailand RI-THBKN5-P1 have risen
more than 11% since the end of February to their highest since
August 2013 at $492.5 a tonne.
The market topped $1,000 a tonne during the food crisis of
2008, when export restrictions and panic buying buoyed prices.
"We are unlikely to see a repeat of 2008," the Singapore
rice trader said. "One thing is that the world has enough
supplies, especially in India where inventories are very large."
Global rice stocks are estimated to surpass 180 million
tonnes for the first time this year, up 28% since the 2015-16
season.
But those inventories are not distributed evenly, with more
than 153 million tonnes in China and India alone.
That means big rice buyers such as the Philippines, the top
importer, and others in Asia and Africa could be vulnerable if
crop movements are curtailed for long.
"Our rice inventory is good for 65 days. We have enough rice
for the next two months," said the Philippines Agriculture
Secretary William Dar, adding that with additional supply coming
from the dry season harvest, there would be enough for the next
four months.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Rice and wheat exports prices https://reut.rs/2xsYYHq
No shortage: Combined rice & wheat output, exports and stocks
expected to be at or near all-time highs this year https://reut.rs/2UD7qLV
Months of rice stocks in top importers https://reut.rs/2xsfM0U
FACTBOX -Trade restrictions on food exports due to coronavirus
pandemic ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>