RICE AND RUBBER
By WALTER FLETCHER, M.P.
AT first the connection between two such widely divergent com- modities as rice and rubber would seem remote, but, with conditions as they are in the Far East, from which I have just returned after a seven weeks' trip, the shortage of rice may well lead to a greatly reduced production and increased cost in rubber, which is one of the commodities from British territories that provide this country with a rich crop of dollars. There is an overall rice shortage in the world, but a local surplus in Siam. _During the last year or two of the Japanese occupation, Siamese producers and merchants stored and guarded their rice, which if grown some distance from the rivers can be kept in good condition for quite a few years. When we re-occupied Siam with light forces, an offer of reparation of about 500,000 tons of rice was made but turned down, as we asked for 1,200,000 tons, which was assessed to be surplus to local needs. Under Treasury pressure, but against the policy of the United States, we continued to ask for 1,zoo,000 tons as reparations, although the possibility of our receiving it vanished as soon as our occupation troops were withdrawn. The responsibility for con- tinuing this unreal policy must rest on the Treasury. It is difficult to understand why anyone should think that holders of a food-stuff
of known international value should give it up unless compelled to do so. Many members of the Siamese Government themselves were, in their private capacities, interested in rice, and the last thing they desired was to see this rice taken from them or from any other Siamese citizen, either for nothing or against payment in the local currency, Ticals, which is of doubtful value.
On 'May 3rd, 1946, a Tripartite Commission was set up, consist- ing of the U.S., Siam and this country, and with a flourish of trumpets a contract for the delivery of 1,2oo,000 tons of rice over twelve months was signed. But, once more, the gravest psychological error was made, for the agreement meant that the actual owner of rice, whether the poor peasant producer, the small or large merchant, was to receive the mistrusted local currency, and the Government was to receive from the foreign buyer the foreign exchange, whether in dollars, sterling or rupees. The natural result has been a short- fall up to date in this contract of between 600,000 and 7oo,000 tons. The paper allocations made from Washington Combined Food Board have meant practically nothing ; rice has been imported into Malaya and Ceylon and other Far Eastern countries from Brazil, with attendant waste of shipping: In fact, the world has been treated to a spectacle of the doubtful working of international food agree- ments if not based on the same laws of economics as attach to private contracts. For two-and-a-half years this surplus of rice has defeated the ingenuity of men, and even today, when arrangements are in train to provide that the `actual owner of the rice gets the whole or part of its equivalent value in foreign currency and is not dispossessed by his Government against a more or less worthless paper currency, there is some risk, owing to difference in price- levels between Siamese and Burmese rice, of shipments not increasing as they should.
While we have been discussing in the House and elsewhere world machinery for dealing in commodities and food-stuffs, the creation of buffer stocks and maxim= and minimum prices, we have had an instance before us of a local surplus whose release would have had the most far-reaching effects throughout the world and which is still unavailable.
Local official; on the spot have done a wonderful job, but their advice has, on the whole, been disregarded in the theoretical stratosphere of Washington Allocation Boards and Whitehall theorists. Five hundred miles away in Malaya the rice ration has, for the past eighteen months, been about 4 ounces per head. This' has been supplemented where possible by broken rice, a certain amount of grain, and, where it can be afforded, purchases in the rice black market, which automatically sprang up in Malaya when the Siamese price was fixed too low. A so-called "black market" can, in one of its forms, be a useful corrective to Government blunders. The effects in Malaya of this ridiculously low rice-ration have been far-reaching in both political and economic spheres. The consensus of opinion of the four great potentates who, under the present dispensation, have a big say in the running of Malaya—the Governor-General, the Governor of the Straits Settlements, the Governor of Singapore and th! Special Commissioner for the Far East—is that about 75 per cent, of the troubles and difficulties in Malaya are due to this totally inadequate ration. The grain that has had to be imported here and into other countries in the place of rice has been at the expense of Europe, and it will be quickly perceived that, if an extra soo,000 tons of rice had been obtained by more informed and intelligent methods, the release of grain for starving Europe would have been considerable.
Strikes at ports, the slow and inefficient handling of cargo, with consequent delay to valuable shipping, political tension and an atmosphere most propitious to undesirable outside influence can all be traced to this inadequate diet. Rising costs, due to the fact that producers of both tin and rubber and others in every walk of life have had to supplement the rations of their employees by purchase in black markets, have materially affected production-costs all round. Malaya and Hongkong are the only two Far Eastern areas which can be looked upon as relatively stable points ; all around is chaos and fear of even worse, civil war and conflagration, some of which might spread to Malaya itself. Such pointers as the mass migration of z,000,000 Chinese from the mainland of China to Hongkong are a proof of this. It is therefore of the highest importance in the problem of political pacification in the Far East that Government plans for thesc two areas should not be frustrated by permanent under-nourishment of a large part of the population. Long-term plans such as growing more food-stuffs, including rice in Malaya, are contemplated ; but the immediate task is the release of the Siamese surplus. A recent increase on paper of the Malayan rice-ration to about 51 ounces per day, when about 14 to 16 ounces would be an adequate ration, shows how far from a proper nutritional basis we are.
Malaya is the dollar arsenal of the Empire. Last year, by a remarkable effort far greater than the most optimistic assessments had thought possible, 555,000 tons of rubber were shipped. A high proportion of this was rubber from Asiatic holdings. The idea that prevails in the minds of most people—that rubber is entirely grown on estates owned and run by European companies—is totally wrong: Normally, over 50 per cent, and often over 6o per cent. are produced by small holders, largely Chinese but also of many other Asiatic races. Their quality has proved admirable, and they are really the cheapest producers. At the other end of the scale is the big-plantation group scientifically organised, and run with a much higher yield than in the native-owned areas by means of bud-grafting, seed-selection and other modern scientific methods. In between, with a poor chance of survival, is the individual European-. owned plantation with heavy superstructure of expenses and directors and not very up-to-date in its methods. Economic evolution will probably tend to eliminate this class of producer, and eventually something like a 60-40 balance between native and group-estate production will remain.
The Dutch East Indies are in turmoil, and the chance of big pro- duction from that area over the next year or two is remote. How vital then it must be that production of rubber, which is likely to rise in price owing to increased production-costs and increased demand, and which will in consequence provide us with mote badly-needed dollars, should not be checked by further errors regard- ing rice! Empty bellies produce trouble and political unrest. The competition of synthetic rubber is aways a factor to be considered, but the potential public demand for rubber, which is infinitely greater than the capacity of factory-production in Europe in any near future, and the obvious preference even in America for the more easily-worked natural rubber, leave an admirable field for Far Eastern rubber at a reasonable price for many years to come. Political manoeuvring has been a main stumbling-block with Siamese rice, and is equally so in arriving at a fair price for natural rubber, but in the end the pent-up demand for rubber will prevail and then any deficit in the nutritional standard due to lack of rice will have an important and possibly fatal effect.
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