WRITTEN QUESTION P-1652/97 by Johanna Maij-Weggen (PPE) to the Commission (5 May 1997)

Subject: Rice market

1. In the Commission's view, what are the causes of the crisis on the rice market, and how does it arrive at this conclusion?

2. Is the Commission aware that there is a fall in prices not only on the Indica rice market but also on the Japonica rice market? How great is the fall in prices and what does the Commission think is the cause? Has Japonica rice been imported into the Union in the last six months? What volume is involved, and where has it been imported from?

3. What was the volume of production of Indica rice in the Union in the season just ended, how much has already been sold and what quantity is still available? Given the shortage of Indica rice within the Union, does the Commission see any justification for exemption measures?

4. What is the extent of the shortage of (Indica) rice within the Union and from where, and at what price, will it be imported in order to meet the demand for consumption within the Union?

5. How does the Commission calculate the difference in price between rice originating in the OCT and Community rice, and what was the price of Community rice compared with rice from the OCT in the season just ended?

6. Can the Commission indicate the growth in OCT imports in comparison with the years 1995 and 1996, and state how it arrives at these figures?

Answer given by Mr Fischler on behalf of the Commission (28 May 1997)

1. The crisis in the Community's rice sector has been due, firstly, to the increase in Community production, in particular because of Spain's re-entry into indica production after several years of drought, and, secondly, to the rise in imports from the overseas countries and territories.

2. Prices for Italian japonica range currently between 90% and 95% of the intervention price. This is due to the following factors:

- a structural surplus of japonica in the Community;

- production of japonica in 1996/97 was 15% higher than in 1995/96 because of good weather and the conversion from indica to japonica in Italy;

- since the beginning of the 1996/97 marketing year, almost 15 000 tonnes of milled japonica equivalent have been imported, in particular from the OCT.

3. Community indica production in 1996/97 is put at 632.045 tonnes of paddy rice. In Italy, 73% of the harvest has been sold while in Spain, which represents the most important market for this type of rice, a major share remains unsold (the Commission does not have exact figures for Spain) and is being offered into intervention.

The safeguard measures that have been taken are entirely justified because, in spite of the deficit in indica in the Community, imports are considerably in excess of the Community's internal needs, preventing Community rice from finding an outlet on the market. Among the imports, the impact of rice from the OCT is the most significant.

4. The Community's deficit in indica is almost 300 000 tonnes of milled rice equivalent. The main supplier countries are the OCT, the United States and Thailand. Import prices vary considerably according to origin, quality, type of rice and processing stage.

5. When the first activation of the safeguard clause took place in January 1996, the import price plus cost and freight for semi-milled rice originating in the Netherlands Antilles was approximately ECU 460/tonne, compared with a price for Spanish indica paddy rice of around ECU 324/ tonne.

6. Imports from the OCT in 1995 were close to 270 000 tonnes of husked rice equivalent; in 1996 this went up to over 350 000 tonnes.