Myanmar cyclone stirs more rice supply fears

BANGKOK Mon May 5, 2008 9:08pm IST

BANGKOK (Reuters) - The cyclone and flooding in Myanmar's two major rice growing areas have "potentially serious effects" for food supply in two other impoverished countries, a U.N. official said on Monday.

World Food Program spokesman Paul Risley said it was not yet known whether Myanmar could meet its commitments to supply tens of thousands of tonnes of rice to Sri Lanka and neighboring Bangladesh.

He said it was too early yet to assess the damage to crops in the main rice-producing regions.

"These are longer term questions and a major issue of concern because of the potentially serious effects for food supply in those countries at a time when global supplies are short," he said.

In the former Myanmar capital Yangon, an official said the planned shipment of 50,000 tonnes of milled rice to Sri Lanka in May may be delayed as the government needs to check its stocks.

"We are still carrying out a damage survey of our rice stocks and will make an appropriate decision after that," said an official at the Union of Myanmar Federation of Commerce and Industry, who declined to be identified.

Myanmar state media said in April the country had exported about 400,000 tonnes of rice in the past year because it had enough supplies to feed its 53 million people.

Global stocks for the staple food of half of the world's population have halved since hitting a record high in 2001.

Prices in Asia have almost trebled this year as export restrictions by leading suppliers fuel insecurity over food supplies.

With only 30 million tonnes traded annually, government supply curbs, such as those imposed by major producers India and Vietnam, have spooked importers such as the Philippines and Bangladesh.

The military, which has ruled for 46 years and is shunned by the West, gave a "careful green light" to offers of international aid, U.N. officials said on Monday.

The World Food Program says it has stocks of around 930 metric tonnes in Yangon and is seeking to bring in more food.

The government had a provisional death toll of 10,000 from the weekend's devastating cyclone, with 3,000 others missing, a diplomat said after a briefing from Foreign Minister Nyan Win.

Hundreds of thousands are without shelter and drinking water after the cyclone tore through the Irrawaddy delta, the rice bowl of the impoverished Southeast Asian country.

It is not known whether Myanmar, the world's largest rice exporter when it won independence from Britain in 1948, will need to import emergency rice supplies. If it does, it is likely to inflate prices further.

Prices for most basic food items, including rice and cooking oil, have soared on the streets of Yangon since the cyclone hammered the city on Saturday.

(Additional reporting by Aung Hla Tun in YANGON)

(Editing by Darren Schuettler)

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