Sushi rice, sticky rice, rice wine vinegar, saki and ethanol. Ethanol? Yes, ethanol - the Japanese are experimenting with rice as fuel. A recent article in the Wall Street Journal explored the subject. But as is always the case, there's more to the story than the quick hit.

With all of the recent news about food shortages and rising food prices worldwide, the idea of growing rice for ethanol would seem ludicrous on the surface. Rice is even more of a main staple than corn for most of the world's population - much more - and just look at the political blame being laid on the threshold of corn ethanol. But in Japan, it's possible, just possible that it makes sense.

Rice Today

Did you eat rice today? If you live in Asia, the answer is almost assuredly "yes." Even in America, we consume 30 pounds of the grain per person, per year - a paltry amount compared with the 132 pounds per person, per year the Japanese eat. With a world production of roughly 431 million metric tons this year, rice is a large crop - the third-largest global grain after wheat (596 million metric tons) and corn, at roughly 775 million metric tons. As mentioned in an earlier piece on HAI, Dipping Into The Rice Bowl, rice accounts for one of every five calories consumed in the world. That's 20%.

And rice hasn't missed the grain boom.

Rice on the world market is still high, though it has backed substantially off the record prices it hit earlier this year. The combination of export restrictions in Vietnam ending and good harvest projections have helped prices recede. Harvests in big rice countries such as Thailand, Vietnam and India are expected to be good as we move into late summer and early fall. So good in fact, that Malaysia has decided to wait for prices to drop below $600 per metric ton before it finishes buying the rice it needs. (The current standard of Thai white rice is around $720 per metric ton.)

As we discussed back in May, here in the States, rice plantings are up by about 9,000 acres. But with stockpiles at all-time lows, even a record harvest doesn't alleviate the squeeze on rice stockpiles.

Elsewhere in the world, devastated Myanmar is still trying to get its crop planted and has run into some serious and unusual problems - the latest? Stressed buffalo. The government has transported all sorts of draft animals to the areas that have lost their working animals, but the animals are having a hard time adjusting. Normally it wouldn't be a problem to let the big guys settle in before getting them under the yoke, but time is running out for the farmers to get their crops in the fields if they are going to have any harvest at all.

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