Thailand's rice exports are unlikely to reach a target of 8.5-9 million tonnes this year, if shipments remain in free-fall for another two months, according to the Thai Rice Exporters Association.

''We should ship an average of 708,333 tonnes a month to achieve 8.5-9 million tonnes as earlier projected,'' said the association's president Chookiat Ophaswongse.

''But based on exports in January, and with another fall anticipated this month, we are wondering whether we will achieve that target.''

According to Mr Chookiat, Thailand's rice exports dropped 38% year-on-year in January to about 630,000 tonnes.

The drop was mainly due to weak demand and the relatively high price of Thai white rice, which is propped up by government intervention in the domestic market.

Thailand exported 10 million tonnes of rice in 2008.

Benchmark 100% B grade white rice was quoted by exporters at US$590 per tonne, $180 higher than that from Vietnam, only $410 per tonne.

As a result, Thai white rice shipments fell in January to 200,000 tonnes from about 400,000 tonnes in the same period last year.

This fall was offset by parboiled rice and premium-grade fragrant rice. But Mr Chookiat expects rice exports this month to be low as 600,000 tonnes.

White rice prices are unchanged while orders for premium-grade fragrant rice are likely to be down on last month, when most orders were for Chinese New Year.

Thailand's premium-grade fragrant rice shipments in January rose to 200,000 tonnes, mostly to China and Hong Kong, compared with average monthly exports of only 120,000 to 150,000 tonnes.

Shipments of parboiled rice, mainly to Africa, rose to 200,000 tonnes last month from 150,000 tonnes.

''Thai rice exports will be subject to mounting pressure, particularly in the second half when India is expected to totally lift its ban on non-basmati rice exports,'' said Mr Chookiat.

India, one of the world's biggest rice producers, banned exports of non-basmati rice last year when dwindling stocks and rising prices triggered fears of shortages of the staple.

Last year, India shipped only 2.9 million tonnes, a significant decline. India usually exports around 5-6 million tonnes of rice, made up in roughly equal portions of basmati, parboiled and white rice.

According to Mr Chookiat, Indian parboiled rice is much cheaper than that from Thailand, with a price difference of up to $200 per tonne.

Demand is also likely to fall this year, especially in Asia, where most of the main rice-buying countries are well stocked.

The Philippines, the world's biggest importer, said late last year it could import about 1.5 million tonnes in 2009, down from huge purchases of 2.3 million tonnes in 2008.

''I see a big drop in Asia as the Philippines has sent a signal that it will buy less rice this year _ and if it wants to buy, it will buy from Vietnam as their prices are cheaper,'' he said.

Vietnam, the world's second biggest rice exporter, may export more than five million tonnes in 2009, up from 4.72 million in 2008.

Source: Bangkok Post