The Economic Effects of Public Stockholding Policies for Rice in Asia

image of The Economic Effects of Public Stockholding Policies for Rice in Asia

This report examines how public stockholding policies related to rice in Asia can influence domestic and international markets. Following a review of the working of rice public stockholding programmes in eight Asian countries (Bangladesh, China, India, Indonesia, Japan, Korea, the Philippines and Thailand), the report examines the impacts of these programmes over the medium term (2018-2030) and analyses how these impacts would change should the selected countries collectively set their public stocks to either a low or high level. Results show that the strongest impacts would occur during the three-year transition period when countries adjust their public stocks to the new levels, but that there would also be structural impacts over the medium term, although at a lower intensity, on procurement, domestic and international prices, availability, private stock levels, and public expenditure. In the event of a global production shock, the model projects that the immediate impact on prices and availability would be less severe under the high public stock scenario, but that recovery would be faster and public expenditure lower when countries hold smaller public stocks.


Executive summary

Public stockholding programmes, whereby governments purchase, stockpile and distribute food staples, have regained popularity as a policy tool since the 2007-08 food price crisis. Governments deploy these programmes with a view to shielding consumers from food price spikes and providing more stable domestic prices for both consumers and producers. However, these programmes may also have additional and unintentional impacts on domestic and international markets, depending on how they function and the scale of intervention.


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