By Apornrath Phoonphongphiphat
BANGKOK (Reuters) - Rice prices in Thailand, the world'stop exporter, surged to $1,000 (500 pounds) a tonne on Thursdayas concerns about food security first triggered by a handful ofAsian export bans spread as far as the United States.
This week's five percent jump takes prices to nearly threetimes their level at the start of the year, intensifying fearsof social unrest in Asia as millions of the region's poor findthemselves struggling to pay for staple goods.
The surging price of fuel and food, which some analystsattribute to panic buying by both consumers and governmentsrather than a dire shortage of supply, has so far sparked riotsin Africa and Haiti, but not Asia.
Having started with India's imposition of export curbs toprotect domestic supplies last year, the crisis was felt in theUnited States this week, with major retailers saying they hadstarted to notice signs of panic buying.
Sam's Club, a unit of retail giant Wal-Mart, said onWednesday it was capping sales of 20-pound (9 kg) bulk bags ofrice at four bags per customer per visit to prevent hoarding.
The previous day, rival Costco Wholesale Corp said it hadseen increased demand for items such as rice and flour ascustomers, worried about global food shortages, stocked up.
"Everywhere you see, there is some story about foodshortages and hoarding and tightness of supplies," said NeaumanColeman, an analyst and rice broker in Brinkley, Arkansas.
NEW ERA?
In Bangkok, some traders said Thai 100-percent B gradewhite rice, the world's benchmark, could hit $1,300 a tonne dueto unsated demand from number-one importer the Philippines,which fell well short of filling a 500,000 tonne tender lastweek.
Manila said on Thursday it had increased the size ofanother tender on May 5 to 675,000 tonnes from 500,000 tonnes,putting yet more heat under the price of a grain that fordecades moved sedately between $200 and $300 a tonne.
There is also a big question mark over Iran and Indonesia,two countries that normally buy as much as 1 million tonnes ofThai rice each year but which have bought nothing so far in2008 because of the soaring prices.
Indonesia's trade minister said on Thursday her country canmeet domestic demand for rice this year, avoiding the risk ofsocial unrest, thanks to a bumper rice harvest, curbs on riceexports and subsidies for the poor.
"If the production of rice is as planned for this year, Ithink we can feel pretty okay that it's going to bestabilised," Mari Pangestu said in an interview.
Even though some analysts say the price, part of a widerglobal rally in crop prices, is based on jittery governmentsrather than fundamentals, Thailand's top exporters say theworld is now set for an era of expensive food.
"Prices will remain firm for the rest of the year,"Chookiat Ophaswongse, head of the Rice Exporters Association inBangkok, told Reuters.
Asian rice prices could rise another 10-15 percent asAfrican importers step up buying, but the market might be setfor a sharp fall nearer year's end, a grains trader said onThursday.
"You might not see a correction in prices in the next twoto three months. But when crops kick in, you could see a 30 to40 percent correction in prices towards the end of the year,"said Vijay Iyengar, managing director of grains trader AgrocorpInternational Pte Ltd.
Rice futures on the Chicago Board of Trade climbed 2.5percent on Wednesday to an all-time high of $24.85 perhundredweight.
However, grain futures tumbled four percent to a five-monthlow due to expectations of a large global wheat crop in 2008.
With the northern hemisphere harvest only two months away,officials said planting had started well in Western Australiaafter good rains, while India said a record harvest and bulginggovernment stocks meant no imports were needed this year.
China's top wheat-growing provinces of Henan and Shandongwere also looking at a bumper winter harvest after recentrains, the Xinhua news agency said.
CRITICISM
Brazil became the latest country on Wednesday to suspendrice exports, following in the footsteps of India and its closerival for the mantle of world number-two supplier, Vietnam.
However, Thailand, which accounts for nearly a third of allrice traded globally, reiterated that it would not impose anycurbs, saying it had enough stocks to meet its exportcommitments.
"We don't need to restrict Thai exports because in the nextfew months, a new crop will come out and we have enough stockfor the Thai people and also for exports, according to theagreements that we have signed," government spokesmanWichianchot Sukchotrat told reporters in Kuala Lumpur.
The Asian Development Bank and free-trade advocates havecriticised the export curbs as an overreaction that hasdistorted the market.
"If we restrict trade, we're simply going to add foodscarcity to the already large problems of food shortages thatexist in different countries," EU Trade Commissioner PeterMandelson said.
(Additional reporting by Sara Webb and Gde Anugrah Arka inJakarta and Jonathan Leff and Sambit Mohanty in Singapore;Writing by Ed Cropley; Editing by Darren Schuettler and DavidFogarty)