However, given the thinness of the international rice market, any factor pointing towards reduced output in one of the major importing or exporting countries could reverse the whole picture. FAO's forecast of world rice stocks at the close of the marketing seasons ending in 1999 has been increased from the previous report by slightly over 1 million tonnes to 51.4 million tonnes. The increase is largely attributed to a rise in anticipated stock levels in India following the Government's upward revision of the 1998-99 output level. Closing stocks in Indonesia, Sri Lanka and Nepal were also adjusted upwards due to good production prospects. However, global stocks would still be almost 4 million tonnes below the closing stocks for the marketing seasons that ended in 1998.
Japan has policies in place that aim at reducing the country's stocks over time.
In addition, its imports are driven by its WTO commitments and, therefore, a fall in its stock levels would have little or no impact on international trade and prices. In Egypt, the expected stock reduction is a function of the Government's policy of limiting rice area that led to a fall in domestic production. The impact of lower stocks in these two exporting countries on international trade and prices is being outweighed by a 20 percent anticipated contraction in import demand, from last year's all-time high, together with ample exportable supplies from many of the other major exporters.