Iraq Bans Rice, Yellow Corn Planting Due to Water Shortages

Iraqi fishermen prepare to fish in the Euphrates River in Samawa, Iraq June 5, 2018. Picture taken June 5, 2018. REUTERS/Essam al-Sudani
Iraqi fishermen prepare to fish in the Euphrates River in Samawa, Iraq June 5, 2018. Picture taken June 5, 2018. REUTERS/Essam al-Sudani
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Iraq Bans Rice, Yellow Corn Planting Due to Water Shortages

Iraqi fishermen prepare to fish in the Euphrates River in Samawa, Iraq June 5, 2018. Picture taken June 5, 2018. REUTERS/Essam al-Sudani
Iraqi fishermen prepare to fish in the Euphrates River in Samawa, Iraq June 5, 2018. Picture taken June 5, 2018. REUTERS/Essam al-Sudani

Iraq has informed farmers of a ban on planting rice and other water-intensive crops in the face of increasing shortages because of drought and shrinking river flows.

A letter from the Minister of Water Resources Hassan al-Janabi to Prime Minister Haider al-Abadi's office showed the ministry had decided to exclude rice and corn from the government's summer agriculture plan to prioritize drinking water, industry and vegetables.

"Rice and yellow corn are out of the summer agriculture plan due to lack of water. As a ministry we are embarrassed, especially as the crops are strategic and farmers had already prepared their land to plant them," agriculture ministry spokesman Hameed al-Nayef said.

"The Ministry of Agriculture cannot plant a single donhum without the approval of the Ministry of Water Resources."

Iraq planted 100,000 donhums of rice last season, he said.

One Iraqi donhum is equal to 2,500 square meters.

Problems with drought and shrinking water levels are further complicated by Turkey's plan to fill a huge dam on the Tigris, which had already started but was paused after complaints from Iraq.

About 70 percent of Iraq's water resources flow from neighboring countries, with the Tigris and Euphrates rivers – which run through Turkey -- particularly important sources.



Oil Prices Set to End Week Higher after US Rate Cut

The US last week announced a 10-nation coalition to counter the attacks in the Red Sea. - File Photo
The US last week announced a 10-nation coalition to counter the attacks in the Red Sea. - File Photo
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Oil Prices Set to End Week Higher after US Rate Cut

The US last week announced a 10-nation coalition to counter the attacks in the Red Sea. - File Photo
The US last week announced a 10-nation coalition to counter the attacks in the Red Sea. - File Photo

Oil prices eased on Friday, but were on track to register gains for a second straight week following a large cut in US interest rates and declining global stockpiles, Reuters reported.

Brent futures were down 50 cents, or 0.67%, at $74.38 a barrel at 1004 GMT while US WTI crude futures fell 48 cents, or 0.65%, at $71.47.

Still, both benchmarks were up 3.7% and 4% respectively on the week.

Prices have been recovering after Brent fell below $69 for the first time in nearly three years on Sept. 10.

"US interest cuts have supported risk sentiment, weakened the dollar and supported crude this week," UBS analyst Giovanni Staunovo said.

"However, it takes time until rate cuts support economic activity and oil demand growth," he added, regarding crude's more muted performance so far on Friday.

Prices rose more than 1% on Thursday following the US central bank's decision to cut interest rates by half a percentage point on Wednesday.

Interest rate cuts typically boost economic activity and energy demand, but some also see it as a sign of a weak US labor market.

The Fed also projected a further half-point rate cut by year-end, a full point next year and a half-point trim in 2026.

"Easing monetary policy helped reinforce expectations that the US economy will avoid a downturn," ANZ Research analysts said.

Also supporting prices were a decline in US crude inventories, which fell to a one-year low last week.

A counter-seasonal oil market deficit of around 400,000 barrels per day (bpd) will support Brent crude prices in the $70 to $75 a barrel range during the next quarter, Citi analysts said on Thursday, but added prices could plunge in 2025.

Crude prices were also being supported by rising tensions in the Middle East. Walkie-talkies used by Lebanese armed group Hezbollah exploded on Wednesday following similar explosions of pagers the previous day.

Security sources have said the Israeli spy agency Mossad was responsible, but Israeli officials have not commented on the attacks.

China's slowing economy also weighed on market sentiment, with refinery output in China slowing for a fifth month in August and industrial output growth hitting a five-month low.