WASHINGTON – An Arkansas rice farmer asked Congress to support efforts of the U.S. rice industry to restore the U.S. rice market in Iraq to levels of the pre-Gulf War era in the 1980s. At the time, Iraq was the No. 1 market for U.S. rice.
Testifying Thursday on behalf of the USA Rice Federation and the U S Rice Producers Association, John King III of Helena told members of the House Agriculture Committee that renewed Iraq market access could have a “tremendous impact” on value-added U.S. rice sales and enhance economic activity in rural rice-producing communities.
King noted USDA estimates Iraq will need to import more than 1 million tons of rice per year for several years. Most of the rice purchases for Iraq since the fall of Saddam Hussein more than a year ago have come from Thailand and other Southeast Asia countries.
“Market development will be vitally important in the months and years to come,” King said, adding that such efforts will be needed to reclaim the market from countries that have benefited from a United Nations food program for Iraq.
He stressed the essential roles USDA's Market Access Program and Foreign Market Development Program will play in U.S. agriculture's efforts to rebuild its markets in Iraq. Further, the rice industry has recommended USDA establish a program for GSM-102 credit for Iraq as soon as possible.
In the late 1980s, Iraq was the top market for U.S. rice. The United States provided nearly 90 percent of Iraq's rice imports, which totaled more than 500,000 metric tons in peak years. In 1991, the U.S. government imposed export sanctions, which closed the market to America's rice industry.
Thailand, China and Vietnam are now major rice exporters to Iraq.
"We estimate the United States lost about $1.9 billion in rice export sales to Iraq from 1991 to 2003," King said. During this time, the Oil for Food Programme, administered by the United Nations, was the main source of Iraq's food supply. Only a small amount of U.S. rice was shipped to Iraq under this program in 2000.
In February 2004, U.S. rice industry leaders met with members of the Iraqi Grain Board in Amman, Jordan, to facilitate re-establishment of a commercial trade relationship. A follow-up meeting with an Iraqi trade delegation is planned, King said.
While the rice industry works to rebuild trade, King urged Congress to lend its support.