<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107285615-1691937285562-gettyimages-1251256675-China_Agriculture-820x462.jpeg" alt="" class="wp-image-426752" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107285615-1691937285562-gettyimages-1251256675-China_Agriculture-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107285615-1691937285562-gettyimages-1251256675-China_Agriculture-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107285615-1691937285562-gettyimages-1251256675-China_Agriculture-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107285615-1691937285562-gettyimages-1251256675-China_Agriculture-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107285615-1691937285562-gettyimages-1251256675-China_Agriculture.jpeg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Chinese villagers growing rice seedlings in a paddy field in Qiandongnan, Guizhou Province, China on April 2023. Future Publishing | Future Publishing | Getty Images</figcaption></figure>



Global rice markets could come under further strain as the world’s leading rice producer China grapples with heavy rain and flood risks.&nbsp;



“Heavy rain in China’s grain-producing north-eastern region that will reduce yields is likely to put upward pressure on already high global rice prices,” Fitch Ratings said in a recent report.



China is the world’s largest producer of rice, and flood alert levels were raised for three provinces that account for 23% of the country’s rice output: Inner Mongolia, Jilin and Heilongjiang, the report pointed out.



The world’s second largest economy has been inundated by devastating floods in recent weeks. Typhoon Doksuri was one of the worst storms to hit northern China in years, with capital Beijing battered by the heaviest rainfall in 140 years. 



Fitch pointed out that many key grain production areas in those three provinces were affected by heavy rains and remnants of Typhoon Doksuri, and they’re set to face “another deluge as Typhoon Khanun moves north.”



The resulting soaked grain fields will reduce crop yields for the year, the Fitch report stated, although the full extent of the damage is not yet clear.



“This will lift China’s domestic grain prices and likely drive higher imports in 2H23 to partially offset the potential yield loss,” the credit ratings firm said, adding the country may need to look to import more rice if its own harvests fall short, and that could drive global rice prices even higher.



Global rice prices have surged to their highest in close to 12 years, according to the Food and Agriculture Organization All Rice Price Index. 



Other market watchers are estimating higher rice prices ahead after India banned non-basmati white rice exports last month, and Thailand urged farmers to plant less rice in a bid to save water as a result of low rainfall.



India, which accounts for more than 40% of global rice trade, banned exports of non-basmati white rice on July 20, as the government looked to tackle soaring domestic food prices.



Rice prices are hovering at decade highs, with rough rice futures last trading at $15.98 per hundredweight (cwt).



In addition to rice, the Fitch report also cited corn and soybean among major crops grown in Inner Mongolia, Jilin and Heilongjiang, which will be impacted by flood risks. China is expected to import more of both grains this year compared to the last.

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Rice prices surged to their highest in almost 12 years on the back of India’s rice export ban and adverse weather conditions that could impact production, said the United Nations’ food agency.



The Food and Agriculture Organization All Rice Price Index for July rose by 2.8% to 129.7 points.



The figure is up 19.7% compared to a year ago, and the highest nominal value since September 2011, data from FAO showed. The sharpest increases in price came from Thailand.



“Concerns over the potential impacts of El Nino on production in some suppliers provided further underpinning to prices, as did rain-induced interruptions and quality variability in Vietnam’s ongoing summer-autumn harvest,” the report stated.



El Nino is&nbsp;a climate phenomenon marked by extreme temperatures and weather conditions that could interrupt lives and livelihoods.



India, the world’s leading rice exporter, banned exports of non-basmati white rice on Jul. 20, as the government seeks to keep a cap on soaring food prices at home, and ensure there are enough supplies domestically “at reasonable prices.” 



The country accounts for more than 40% of the global rice trade. Even if it affects a portion of India’s overall rice shipments, FAO noted that India’s export restriction “raises substantial food security concerns for a large swathe of the world population.”



Rice prices are hovering at decade highs, with rough rice futures were last trading at $16.02 per hundredweight (cwt).



And these prices could climb higher.



“We will most probably see a higher FAO rice price index for August 2023 vs July 2023,” Oscar Tjakra, senior analyst at global food and agriculture bank Rabobank, told CNBC.



He added that India’s non-basmati white rice export ban came at a time of seasonal low inventories in major global suppliers of rice, especially those in Asia.



Prices could surge further if other countries follow suit in implementing export restrictions.



“The prices can go even much higher if importing countries try to stockpile rice for domestic food security, and exporting countries put export restrictions,” said Samarendu Mohanty, Asian regional director at International Potato Center.



El Nino could further exacerbate risks on global production in other major Asian rice producers such as Thailand, Pakistan and Vietnam.



“For the next few months, global rice prices’ direction will be determined by the impact of El Nino,” Tjakra said in an email.



Rice, being a vulnerable crop, has the highest probability of simultaneous crop loss during an El Nino event, a scientific study showed.



To make matters worse, Thailand, the world’s second largest exporter of rice, is now encouraging its farmers to plant less of the crop in a bid to save water as a result of low rainfall.

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/A-container-ship-from-China-owned-Cosco-Shipping-sits-in-the-Port-of-Oakland-in-California-on-Aug.-7-2023-820x462.jpg" alt="" class="wp-image-426671" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/A-container-ship-from-China-owned-Cosco-Shipping-sits-in-the-Port-of-Oakland-in-California-on-Aug.-7-2023-820x462.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/A-container-ship-from-China-owned-Cosco-Shipping-sits-in-the-Port-of-Oakland-in-California-on-Aug.-7-2023-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/A-container-ship-from-China-owned-Cosco-Shipping-sits-in-the-Port-of-Oakland-in-California-on-Aug.-7-2023-160x90.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/A-container-ship-from-China-owned-Cosco-Shipping-sits-in-the-Port-of-Oakland-in-California-on-Aug.-7-2023-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/A-container-ship-from-China-owned-Cosco-Shipping-sits-in-the-Port-of-Oakland-in-California-on-Aug.-7-2023.jpg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A container ship from China-owned Cosco Shipping sits in the Port of Oakland in California on Aug. 7, 2023. Justin Sullivan | Getty Images News | Getty Images</figcaption></figure>



BEIJING — China said Tuesday that exports fell by 14.5% in July from a year ago, while imports dropped by 12.4% in U.S. dollar terms.



That’s worse than what analysts had expected.



A Reuters poll predicted a 12.5% decline in exports in July from a year ago, in U.S. dollar terms. Imports were expected to have dropped by 5% during that time, according to the poll.



China’s exports to the U.S. plunged by 23.1% year-on-year in July, while those to the European Union fell by 20.6%, CNBC analysis of customs data showed. Exports to the Association of Southeast Asian Nations fell by 21.4%, according to the data.



China’s imports from Russia fell by 8.1% in July from a year ago, the data showed.



A slowdown in U.S. and other major economies’ growth has dragged down Chinese exports this year. Meanwhile, China’s domestic demand has remained lackluster.



Chinese imports of crude oil dropped by 20.8% in July from a year ago, while imports of integrated circuits fell by nearly 17%.



July’s decline in trade adds to recent weakness in China’s exports and imports.



On a year-to-date basis, China’s exports for the first seven months of the year fell by 5% from a year ago, while imports dropped by 7.6% during that time.



Among the few higher-value export categories that saw a significant increase in the first seven months of the year were cars, refined oil and bags, suitcases and similar receptacles.



For imports, paper pulp, coal products and edible vegetable oil were among the categories seeing significant growth in the January to July period from a year ago.



Chinese imports of crude oil dropped by 20.8% in July from a year ago, while imports of integrated circuits fell by nearly 17%.



July’s decline in trade adds to recent weakness in China’s exports and imports.



On a year-to-date basis, China’s exports for the first seven months of the year fell by 5% from a year ago, while imports dropped by 7.6% during that time.



Among the few higher-value export categories that saw a significant increase in the first seven months of the year were cars, refined oil and bags, suitcases and similar receptacles.



For imports, paper pulp, coal products and edible vegetable oil were among the categories seeing significant growth in the January to July period from a year ago.

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107282570-1691401058900-GettyImages-1581548195-820x462.jpg" alt="" class="wp-image-426648" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107282570-1691401058900-GettyImages-1581548195-820x462.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107282570-1691401058900-GettyImages-1581548195-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107282570-1691401058900-GettyImages-1581548195-160x90.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107282570-1691401058900-GettyImages-1581548195-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107282570-1691401058900-GettyImages-1581548195.jpg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">NIAMEY, Niger &#8211; August 6, 2023: Mohamed Toumba, one of the leading figures of the National Council for the Protection of the Fatherland, attends the demonstration of coup supporters and greets them at a stadium in the capital city of Niger. The 7-day deadline given by Economic Community of West African States (ECOWAS) to the military junta on July 30 for the release and reinstatement of President Mohamed Bazum expired at midnight. Balima Boureima/Anadolu Agency via Getty Images</figcaption></figure>



Niger’s coup leaders on Monday closed its airspace after an ultimatum from the Economic Community of West African States to reinstate elected President Mohamed Bazoum expired on Sunday night.



The military junta calling itself the National Council for the Safeguarding of the Fatherland seized power on July 26 and detained Bazoum, with the commander of the country’s presidential guard, General Abdourahmane Tchiani, proclaiming himself the country’s new leader.



The coup was widely condemned by the international community, including the U.S., the European Union, Russia and former colonial power France, along with Nigerian-led regional body ECOWAS, which also sanctioned the junta.



Many foreign countries have already begun evacuating embassy staff and citizens from Niger, while the likes of the U.S. and U.K. have partially suspended aid programs.



The 15-member ECOWAS gave the military junta one week to return the elected government to power and restore constitutional order, threatening the use of force if its demands were not heeded.



As the Sunday night deadline loomed, thousands of Nigeriens gathered at a stadium in the capital Niamey to show support for the coup leaders, while rallying against France and other Western powers and voicing admiration for Russia.



In a statement on national television on Sunday, a spokesman for the Niger junta repeated claims that a “foreign power” was preparing military intervention, and said the country’s military stands ready to respond.



ECOWAS defence chiefs met late last week to draw up plans for a possible military response, and Abdel-Fatau Musah, commissioner for political affairs, peace and security, said on Friday that the bloc’s heads of state will make a final decision.



“All the elements that will go into any eventual intervention have been worked out here, including the resources needed, the how and when we are going to deploy the force,” Musah said at the close of the three-day meeting in Abuja, Nigeria.



Nigerian President Bola Tinubu, who also serves as chair of ECOWAS, sent a letter to the senate on Friday, asking members to back a regional intervention in the neighboring country, according to local media reports.



There were no aircrafts seen over Nigerien airspace on Monday, according to FlightRadar24, which said in a blog post that flights already in the air when the airspace closed were rerouted or diverted. It added that the no-fly order is likely to be extended beyond the initial Monday night expiry.



“The closure of Niger’s airspace dramatically widens the area over which most commercial flights between Europe and southern Africa cannot fly. Flights must already take a detour of sorts around Libya and Sudan,” the flight tracker said.

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107281094-1691050703126-gettyimages-625667906-93552422-820x462.jpeg" alt="" class="wp-image-426631" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107281094-1691050703126-gettyimages-625667906-93552422-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107281094-1691050703126-gettyimages-625667906-93552422-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107281094-1691050703126-gettyimages-625667906-93552422-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107281094-1691050703126-gettyimages-625667906-93552422-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/107281094-1691050703126-gettyimages-625667906-93552422.jpeg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Smoke billows from an unauthorized steel factory, foreground, on November 4, 2016 in Inner Mongolia, China. To meet China’s targets to slash emissions of carbon dioxide, authorities are pushing to shut down privately owned steel, coal, and other high-polluting factories scattered across rural areas. (Photo by Kevin Frayer/Getty Images) Kevin Frayer | Getty Images News | Getty Images</figcaption></figure>



Developing nations will need more than $1 trillion each year to make significant progress in climate transition, according Mari Pangestu, a former World Bank official.



“The estimate is like $1 [trillion] to $3 trillion a year for developing countries to be able to transition,” she told CNBC’s “Squawk Box Asia” on Thursday.



The lack of funding has made it difficult for those countries to reduce their high carbon emissions and shift to clean energy, Pangestu added. This has led to tensions between developing nations and the developed world, which are pushing for more progress in climate related issues.



“This debate is going to continue unless developed countries can see that this is about development and climate — not just about climate,” Pangestu, a former trade and tourism minister for Indonesia, said.



“And that has been the source of tension. You can’t separate the two,” she added, underlining the “key word is actually — transition.”



“How do you transition from the high emission now to clean energy? It will require us to have resources.”



This was “part of the bone of contention,” for the lack of progress made in the recently concluded Group of 20 climate ministers meeting in India, Pangestu said.



The talks in late July wrapped up without consensus on crucial matters to address the climate crisis such as the issue of financing to support developing countries, the document showed.



India’s climate change minister Bhupender Yadav, who chaired the meeting, acknowledged there had been “some issues about energy, and some target-oriented issues.”



<h2 class="wp-block-heading" id="h-sharp-criticism"><a></a>Sharp criticism</h2>



The July climate meeting was seen as a chance for the world’s biggest polluters to take concrete steps ahead of a G20 leaders’ meeting in September in New Delhi and the COP28 Summit in the United Arab Emirates in December.



The failure to reach a deal drew withering criticism from environmental activists.



“Europe and North Africa are burning, Asia is ravaged with floods yet G20 climate ministers have failed to agree on a shared direction to halt the climate crisis which is escalating day by day,” said Alex Scott of climate change think-tank E3G.



“Reports of Saudi Arabia and China stifling the forum’s political space to even discuss a new direction on the energy transition fly in the face of their claims of defending the interests of developing countries,” he added.



China rejected reports it had obstructed climate discussions at the G20 climate meeting, saying “relevant reports totally run counter to the facts.”



The Ministry of Foreign Affairs insisted the meeting “achieved positive and balanced outcomes.”



“However, some countries introduced geopolitical issues as an obstruction and the meeting failed to adopt a communique. China finds it regrettable,” the ministry said without elaborating.



<h2 class="wp-block-heading"><a></a>‘Scale and urgency’</h2>



There’s a “scale and urgency” to address the climate crisis, said Pangestu, adding it requires greater effort from all stakeholders.



“Part of that will have to come from countries’ own resources,” she noted. “Also part of it has to come from multilateral development banks and other sources, which are going to reduce the cost and risks — so that you can get private sector to come in.”



Pangestu argued that if developed nations want to move away from fossil fuels and “retire coals plants early,” more support should be provided to developing countries.



“What South Africa and Indonesia have done more recently on this particular issue is say: ‘That’s fine and well, you want us to get out early’ — but who’s going to fund the cost of getting out early?” she asked.



“These are private companies, you have to also compensate them. There’s a legal issue, financial issue. So this is where we need to really get into the policies and the reforms.”

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