Concerns are rising over Burma’s future rice self-sufficiency following the havoc wreaked by tropical cyclone Nargis on the country’s most important rice-growing area. The storm is also helping to keep rice prices near a record high.

Even before the cyclone sent a powerful tidal surge across vast swathes of the low-lying Irrawaddy Delta, the region’s rice production was far below its potential, its output depressed by state controls that gave farmers little incentive to boost yields.

But while Burma had nevertheless remained self-sufficient in rice, experts say the destruction in the delta – which accounts for 65 per cent of Burmese rice output – will reduce production, and impair access to food nationwide.

One Rangoon-based agricultural expert said: “It is far-reaching, really far-reaching. The region was already under-performing, very much on the edge. Now, it is just devastated.”

Already, rice prices in Rangoon markets have surged by nearly 50 per cent. The UN Food and Agriculture Organisation on Wednesday said the cyclone damage could prevent Burma from fulfilling commitments to export about 600,000 tonnes of rice in 2008.

Fuel ban lifted

Burma’s military government has lifted a ban on private companies importing fuel to try to ease a chronic energy shortage in the wake of cyclone Nargis, a Rangoon-based diplomat said on Wednesday, reports Reuters from Bangkok.

“Private companies have secured an agreement from the government to import fuel, I think, tax-free,” the diplomat said. “It’s also only on a temporary basis, but they haven’t been given an actual timeframe.”

Normally, only the government is able to bring fuel into Burma. PTT, Thailand’s biggest oil and gas firm, said it was getting ready to ship $400,000 (€260,000 £205,000) of fuel, at least a quarter of which was diesel – vital for running generators in a city still with power.

Concepción Calpe, the senior rice analyst at the FAO in Rome, said the country may even need in the short term to import rice from neighbouring countries, including Thailand and Vietnam. “The event would lead to a further tightening of the world rice market.”

However, Ms Calpe said the impact would be mitigated by Philippines’s cancellation this week of a large tender to import up to 675,000 tonnes of rice.

This has eased the price of Thai white rice, the global benchmark, this week by about 10 per cent in spite of the cyclone. Traders quoted indicative offers for Thai rice at about $900 a tonne, down from more than $1,000 a tonne last week. In late April, Thai rice was offered at a tender in Japan at $1,300 a tonne, setting an all-time high, though Tokyo rejected the offers. A year ago, the price was about $300 a tonne. Traders said hopes of further declines would now depend on the extent of Burma’s paddy damage.

But whether or not Burma will be forced to import rice as a result of the storm remains unclear.

The cyclone struck just as the region’s paddy farmers were harvesting the so-called “dry season” crop, which accounts for about 25 per cent of the country’s annual production.

Paul Risley, a World Food Programme spokesman, said several rice warehouses and their stocks were destroyed by the storm and one WFP rice supplier had warned the agency that it might not be able to provide rice already promised to the UN food agency for other needy people elsewhere in Burma.

But the catastrophe will have even greater consequences for the upcoming paddy season, which is supposed to begin in two months. There are questions about whether the shell-shocked survivors will be ready to engage again in the gruelling labour of planting rice.

“There is a question about the ability of the rice planters to get back to cultivation,” Mr Risley said. “They’ve got to put their houses back together first.”

Even if the farmers were willing to plant, their efforts may not bear much fruit. The tidal surge sent sea water as far as 35 miles inland, satellite photos show, leaving large areas of paddy land inundated and unfit for cultivation.

Sean Turnell, an Australian expert on Burma and editor of Burma Economic Watch, said the region’s long-neglected, colonial-era irrigation systems also probably took a heavy blow.

“Rice-growing depends on being able to distribute water properly,” he said. “We have seen channels and dykes, which had been slowly degrading and silting up, inundated. One can only imagine the damage has been great. The next season is unlikely to be anything like a normal harvest.”

The repercussions of the delta’s woes will be felt in millions of impoverished households in Burma, where many families spend a significant portion of their income on food. “I think the overall projection is of incredible hardship,” said Mr Turnell. “In the short term, we are going to see real shortages – and the price of rice is going to be very high.”