Meanwhile, issues regarding U.S. rice exports continue to be a concern for domestic rice producers.

 http://online.wsj.com/article/BT-CO-20060823-705573-search.html?KEYWORDS=ag riculture&COLLECTION=autowire/6month  reported yesterday that, “Apprehension is spreading among rice producers, millers and exporters as they look to the government for answers on how genetically modified crops got mixed into the U.S. food supply and what the economic consequences will be.

“‘The industry just received the news Friday and we got it the same time everyone else got it,’ said David Coia, spokesman for the USA Rice Federation http://www.usarice.com/ . ‘Everyone's asking scores of questions and they're looking for answers.’”

The Dow Jones article also stated that, “USDA officials sat down Tuesday afternoon with rice industry officials, who said after the meeting that they still did not know how the GM grain got into the commercial market.

“The USA Rice Federation, in a prepared statement on its Internet Web site, said it does not yet support the commercialization of any GM rice and has a ‘commitment from technology companies to not commercialize GM rice.’”

Also, Wall Street Journal writer Juliane Von Reppert Bismark http://online.wsj.com/article/SB115637431293443882.html?mod=todays_us_page_ one  reported in todayÂ’s paper that, “The European Commission adopted tough screening rules on U.S. long-grain rice following revelations that an unauthorized genetically engineered rice variety had accidentally entered commercial rice stocks.

“U.S. rice farmers, European importers and the biotech industry say the screening procedures, which are expected to be in place for at least six months, will add to their costs by requiring all long-grain rice varieties to be certified.

“The ruling is also likely to strain trade relations between Brussels and Washington, which says the rice poses no health risk, and to raise questions of how to control the spread of biotech crops that are very unpopular in Europe.”

The Journal article also pointed out that, “U.S. exporters warned the measures may squeeze a rice sector already beleaguered by rising energy costs and increasing competition from abroad.

“The U.S. exports about half its rice. Europe is one of its main customers, importing 198,000 metric tons of long-grain rice worth about €52 million, or about $67 million, last year. Japan banned imports of U.S. long-grain rice last week.”

And Nancy Cole http://www.nwanews.com/story.php?paper=adg&section=Business&storyid =164381 , writing in yesterday’s Arkansas Democrat Gazette (Northwest Arkansas Edition), reported that, “Unmilled rice sold on the Chicago Board of Trade for September delivery fell 50 cents per hundredweight on Tuesday, from $ 9. 55 to $ 9. 05. The exchange limits price swings to 50 cents per hundredweight above or below the previous day’s close.

“Arkansas’ largest rice cooperative, Stuttgart-based Riceland Foods Inc http://www.riceland.com/ ., said late Monday that it had been investigating the matter since January, when an export customer discovered genetically engineered material in a shipment.”

The Democrat Gazette also reported that, “In 2005, Arkansas produced more than 48 percent of the U. S. crop, which was worth $ 1.8 billion. About half of all U. S. rice is exported and approximately 80 percent of those exports are of long-grain varieties, according to the U. S. Department of Agriculture. The U. S. provides about 12 percent of the rice traded in world markets. Nearly 94 percent of Arkansas’ production that year was the long-grain variety.”

In addition, the article pointed out that, “Eric Wailes, an agricultural economist with the University of Arkansas at Fayetteville, said that recent events show that ‘our regulatory system isn’t working in terms of being able to monitor and keep unapproved, noncommercialized varieties out of the supply chain. That’s the real indictment from this problem.’”

For more general background on U.S. rice production, see this U.S.D.A.- Economic Research Service publication, “Characteristics and Production Costs of U.S. Rice Farms http://www.ers.usda.gov/publications/sb974-7/ ” by Janet Livezey and Linda Foreman from March of 2004.

In part, the E.R.S. report found that, “The average cost of producing a hundred pounds (cwt) of rice was $6.00 for U.S. producers surveyed in 2000, ranging from about $2 per cwt to more than $10.”

The report also noted that, “At the marketing-year average price of $5.61 per hundredweight, 78 percent of rice farms were able to cover operating costs and 43 percent covered both their operating and ownership costs of rice production in 2000. After accounting for Government payments, nearly all rice farms (97 percent) were able to cover operating costs in 2000, and about 84 percent were able to cover both operating and ownership costs.”

 

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