April 2 (Bloomberg) -- Indonesia, the world's third-largest rice producer, may join China, India, Vietnam and Egypt in curbing exports as declining inventories threaten to spark unrest around Asia.

The country's rice production may exceed domestic consumption by 2 million metric tons this year, insufficient to allow for exports, Agriculture Minister Anton Apriyantono said today in a text message to Bloomberg News. Indonesians will consume about 36.2 million tons this year, the U.S. Department of Agriculture forecasts.

Rice, the staple food for about 3 billion worldwide, has almost doubled in the past year on rising imports by the Philippines, the biggest buyer, and as global food supplies lag behind demand led by China and India. Record prices for commodities including rice, wheat, soybeans and corn are stoking food inflation and contributed to strikes in Argentina, riots in Ivory Coast and crackdowns on illicit exports in Pakistan.

The world's poor ``are living very close to the edge as it is,'' said Robert Zeigler, director-general of the International Rice Research Institute in the Philippines. ``If they are pushed further, they are typically the first who will spark unrest.''

Consumer prices in China rose 8.7 percent in February, an 11-year high, and reached a 13-month peak in India. Chinese food prices, based on a government index, jumped 28 percent in February, the most since July.

Rice Rally

Rice futures have jumped 94 percent in the past year on the Chicago Board of Trade. The contract for May delivery rose 50 cents, or 2.6 percent, to $19.79 per 100 pounds at 11:57 a.m. Rice reached $20.175 on March 31 from about $10 a year ago.

Indonesia wants to rebuild domestic inventories, Apriyantono said. ``The surplus won't be enough to allow for export,'' he said. ``It's better to strengthen domestic stockpiles.''

Global exports will fall 3.5 percent as countries limit overseas sales to curb rising food costs at home, the Food and Agriculture Organization said today. Exports this year will decline 1.1 million tons to 29.9 million tons, the Rome-based United Nations organization said in an e-mailed report today.

The higher cost of rice also may prompt policy makers in Asia to allow their currencies to strengthen so they have more buying power when purchasing the grain from overseas exporters, JPMorgan Chase & Co. said in a report on March 30. Asian governments likely want to avoid riots and protests caused by soaring prices for wheat, which have doubled in the past year.

Social Unrest

Cameroon's president abolished imports on wheat in March as part of a plan to cool unrest after riots in February. Pakistan sent paramilitary troops to guard wheat supplies to prevent exporters from smuggling grain to neighboring Afghanistan, where it can be sold for a higher price. Ivory Coast security forces used tear gas yesterday to disperse hundreds of people who barricaded streets in Abidjan to protest rising food prices.

The United Nations warned in February that 36 countries, including China, face food emergencies this year, as stockpiles of grains such as rice drop to a 26-year low.

Global rice inventories are expected to rise to 75.2 million metric tons in 2008, USDA data show. Global production will rise to a record 422.9 million tons and consumption is expected to increase to 422.5 million tons, also the most-ever, according to the USDA.

Vietnam Exports

The Vietnam Food Association has asked its members to stop signing new rice-export contracts between April and June, following Prime Minister Nguyen Tan Dung's directive to cut delivery of the grain overseas.

Vietnam, one of the world's three biggest rice exporters, will reduce shipments this year to 4 million tons to ensure supplies domestically and curb inflation that's at its highest in more than a decade. The government also said it's considering a tax for rice exports.

Malaysia plans to step up efforts to import rice from other Southeast Asian nations to build reserves.

``We know the market is tighter now,'' Deputy Prime Minister Najib Razak told reporters March 31 in Kuala Lumpur.

The Philippines is buying the grain from an emergency regional stockpile and taking additional supplies from the U.S.

To contact the reporters on this story: Yoga Rusmana in Jakarta at yrusmana@bloomberg.net; Naila Firdausi in Jakarta at nfirdausi@bloomberg.net

Last Updated: April 2, 2008 13:46 EDT