WELSH — Southwest Louisiana rice farmers could reap benefits from growing Chinese agriculture markets by exporting rice there.
State Agriculture Commissioner Mike Strain and U.S. Rep. Charles Boustany, R-Lafayette, discussed opening the rice market and other agriculture-related issues Monday, with nearly two dozen Southwest Louisiana farmers during a Farm Day breakfast and forum.
“I think we may see more rice moving to China,” Strain said. “Right now China has 20 percent of the world’s population and produces 20 percent of the world’s agriculture, but they are reaching finite limits where they can’t produce any more … I think consumption is going to outpace their ability to produce.”
China is currently a net importer of rice, importing much of it from Thailand and Vietnam, but rice production in those countries has been shaky and will not meet the ultimate demand that China has, so they are looking at the U.S., Boustany said.
“This opens the doors for us, especially with the expansion of the Panama Canal to ship rice from the Gulf Coast,” Boustany said. “The bottom-line is there are going to be opportunities and as China increases its need to import rice, it will have an effect on the world market price, which will be beneficial to us.”
China, the world’s largest consumer of grains, reportedly imported a record high amount of rice in 2012 — mainly from Vietnam, according the General Administration of Customs. Rice imports were up 305 percent to 2.34 million tons last year.
The quality of U.S. rice is also better suited for the Chinese, especially the “upper class” who want better quality, Strain said.
“Looking at China, we have a framework where we deal with them at a high level called the strategic and economic dialog and agriculture trade is part of that,” Boustany said. “We have been talking to them about a number of barriers like sanitary issues that affect agriculture that they seemingly want to talk more about.”
Any future change in trade would depend on the new Chinese leadership, which takes place in March, and the new U.S. cabinet, Boustany said.
“I think this trend in China is potentially a strong positive for U.S. rice and farmers, if we get the policies right over here,” Boustany said.
Trade opportunities are also worth pursuing in Japan and other Asian countries, Boustany said.
Boustany and Strain also addressed the uncertainty of passage of a long-term Farm Bill and anticipated budget cuts affecting agriculture.
The 2008 Farm Bill has been extended until Sept. 30 as congressional leaders attempt to ink a new five-year plan.
“Ideally we want to get a five-year plan that works well for our commodities,” Boustany said.
Boustany said he has received a commitment from Rep. Frank Lucas, chairman of the House Agriculture Committee, to bring forward a bill that successfully passed through committee last year.
“We must have a five-year Farm Bill,” Strain added. “This business about extending it and extending it doesn’t work. We need a Farm Bill and we need it now.”
Strain said he would like to see the new Farm Bill include disaster assistance for Hurricane Issac and Super Storm Sandy. Currently there are no provisions in the extended Farm Bill for disaster assistance dating back to Sept. 30, 2011.
Agriculture departments are also facing major budget issues in 2013 and 2014, Boustany said.
“How these cuts will affect agriculture is something I am deeply concerned about,” Boustany said. “I will do everything I can to make sure we don’t see undue slashing of the commodities budget and look at the rest of the Farm Bill because money is going to have to come out of each department.”
Strain called for no more budget cuts to the LSU AgCenter, saying the cuts hurt the agriculture economy and research projects.