Rice Imports by China Set to Jump Fourfold on Local Prices

Rice purchases by China, the largest producer, may soar fourfold this year after a government policy to support farm incomes drove up domestic prices, the United Nations said.

Shipments may reach 2.3 million metric tons to 2.4 million tons, said Concepcion Calpe, a senior economist at the UN’s Food & Agriculture Organization. That compares a prediction of 2 million tons last month and 600,000 tons in 2011, according to the FAO. While there’s no shortage in China, processors increased imports to profit from the difference between domestic and overseas rates, said Bai Peipei, an analyst at Beijing Shennong Kexin Agribusiness Consulting Co.

Rising imports by China may bolster prices even as world inventories tracked by the FAO swell to a record, boosted by the biggest global crop ever. While rice, the staple for half the world, has risen 4 percent in Chicago this year, it is 17 percent below a three-year high in September 2011. Most purchases by China, which typically imports from Thailand, were of Vietnamese origin this year.