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Rice exports face rocky road in 2012

The export outlook for Thai rice next year will depend on the government’s policy for promoting exports and the export performance of india, says the Thai Rice Exporters Association.

Korbsook Iamsuri, the association president, said exports to African markets have dropped by as much as 70-80% from the usual 3 million tonnes per year. This is partly because Thai rice has to compete with Indian rice, which is US$150-170 per tonne cheaper.

Exports to Indonesia, Iraq, Bangladesh and the Philippines, as well as government-to-government deals also face obstacles due to the higher prices of Thai rice.

“Exports of Thai white and parboiled rice are still good at $590-600 per tonne. This price does not reflect the mortgage price. Rather, it is the price of rice in the stocks of exporters and millers,” she said.

The government mortgage scheme pays 15,000 baht a tonne for unmilled white rice and 20,000 baht for Hom Mali rice.

The prevailing market price of white paddy rice (15% moisture content) ranges between 10,000 and 12,000 baht a tonne, while Hom Mali paddy (15% moisture content) is between 15,500 and 17,000 baht, said the Thai Rice Mills Association.

However, Deputy Commerce Minister Poom Sarapol said there were 5-7 countries that had expressed interest in buying millions of tonnes of rice from Thailand under government-to-government contracts by barter, so the government needs to consider what method would best benefit the country.

The government has not considered whether to release the remaining 2 million tonnes of rice in its stocks, or newly harvested rice.

The Foreign Trade Department will soon discuss with neighbouring rice-exporting countries the possibility of setting common sales prices to ensure price stability in the future.

Ms Korbsook said that Thailand would continue to export Thai Hom Mali rice due to its unique properties, but volume is unlikely to expand from around 2 million tonnes a year, mainly shipped to Hong Kong, the United States and China.

“The market price of Thai Hom Mali rice is $1,200 a tonne, but some exporters sell it for only $1,000,” she said.

As of Nov 15, Thailand had exported 9.89 million tonnes of rice, up 32.64% from the same period last year, according to the association’s database.

Source: Bangkok Post

ThaiVest Editorial Team

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