ALARMED OVER the deteriorating drought situation, many countries have placed orders for Thai rice to secure sufficient stocks for consumption next year.

"The drought problem has started to raise concerns in many countries. Importing countries have considered purchasing more rice, mainly from Thailand, as they are worried about rising prices next year during the drought season," Commerce Minister Chatchai Sarikulya said yesterday.

Countries have contacted the Thai government about obtaining rice from its inventory for late this year and next year, he said.

Although Thailand also forecasts lower domestic yields next year, the government still has plenty of rice left in storage and can ship to many countries.

The US Department of Agriculture reported that many countries had started to face drought. The United States itself is reportedly suffering from its severest drought in 50 years.

Chatchai said that with increasing drought issues, the price of paddy rice in the local market had improved during the past week from about Bt8,000 a tonne to Bt8,500-Bt8,700.

To estimate the impact from the drought crisis, the ministry is cooperating with the Agriculture Ministry to survey and provide exact figures on rice production in the 2014-15 harvest season so that the government can prepare plans for rice exports and local consumption next year.

The Agricultural Ministry's preliminary estimate is about 22 million tonnes of paddy rice.

The Commerce Ministry will continue releasing rice from its stockpiles via many channels including government-to-government and government-to-business deals and general auctions.

The Foreign Trade Department will soon join the bidding to supply 500,000 tonnes of rice to the Philippines. The ministry is also negotiating to deliver rice to Malaysia and Indonesia, and will ship more rice to China under their G2G contract.

The ministry is targeting sales of 1 million more tonnes under G2G contracts this quarter.

Chatchai wants the ministry's Public Warehouse Organisation to adopt more technology in its work, particularly for inspection and preservation of rice stocks. This will prevent damage to warehoused rice and ensure transparency, he believes.

Thai trade offices overseas have been instructed to accelerate the drawing up of strategies and plans for promoting exports next year.

The ministry is scheduled to call a meeting with overseas Thai rice representatives and private enterprises from October 18-20.

Meanwhile , The United Nations Food and Agriculture Organisation has predicted that Vietnam's rice exports would increase by 6 per cent to 6.9 million tonnes this year.

The FAO attributed the increase to the country's rising paddy yield and the rising demand of Asian markets, including Indonesia, Malaysia, China and the Philippines.

The organisation estimated Vietnam's crop this year would hit a record high of 44.5 million tonnes, equivalent to 27.8 million tonnes of rice. That represents an increase of 740,000 tonnes from last year.

The FAO estimated paddy output during the summer-spring and autumn-winter harvest seasons would inch down against that of the same period last year, after the government's decision to use some rice-producing areas for the cultivation of other crops.

The Vietnamese Ministry of Agriculture and Rural Development reported that rice exports in the past nine months reached 5 million tonnes worth US$2.3 billion (Bt75 billion).

In September alone, the nation exported 524,000 tonnes of rice worth $249 million.

Wholesale rice prices in the domestic market increased for three straight months, including last month, because of rising import demand, especially from China.

A tonne of rice with 25-per-cent broken grain content was priced at $400, a 21-per-cent increase against that of September last year.

China remained the largest market for Vietnamese rice, at 33.2 per cent of exports, followed by the Philippines at 22.7 per cent, Malaysia at 6.1 per cent, Ghana at 5.4 per cent and Singapore at 3.3 per cent.

The US Department of Agriculture predicted that Vietnam's rice yield this year would reach 28 million tonnes, equivalent to 45 million tonnes of paddy, and that its exports would reach 6.7 million tonnes.

Source: The Nation