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October 18th, 2010

Via: Bloomberg:

The Philippines, the world’s biggest rice buyer, may lose 600,000 metric tons of the crop as Supertyphoon Megi, the strongest to hit the nation this year, strikes some of the nation’s biggest producing areas, a government official said. Rice futures advanced.

“Once the typhoon hits those areas, the crop will be affected,” Agriculture Undersecretary Antonio Fleta said in a phone interview from Manila. “Even if farmers harvest the damaged rice, they’d have a hard time drying the grain. There may not be much left to sell.”

About 157,000 hectares of land planted to rice in Cagayan and Isabela provinces may be in the path of the typhoon, Fleta said. Megi has sustained winds of 270 kilometers (168 miles) per hour, the U.S. Navy Joint Typhoon Warning Center said, making it a Category 5 storm capable of catastrophic damage.

Half of the planted areas in the two provinces are ready for harvest and the rest are in the reproductive stage, leaving them susceptible to damage, Fleta said.

Damage to Philippine crops would come amid production losses in other countries, further curbing the global harvest and potentially sustaining a rally in prices.

Rough-rice futures have surged 43 percent from this year’s low of $9.55 per 100 pounds on June 30 as flooding in Pakistan and dry weather in the U.S. cut harvests. The contract for November delivery advanced for a fifth consecutive day today, gaining 0.3 percent to $13.655 on the Chicago Board of Trade at 12:10 p.m. Singapore time.

Environment, Food | Posted in Economy Top Of Page