Thai rice exports to Asean are facing more challenges, as relatively higher prices and tariff cuts under the Asean Free Trade Area (Afta) make Thai rice less appealing to regional buyers.

Thailand has already lost its market leadership in Asean, as the grains from Vietnam and Cambodia now control up to 60% of the market, according to Somkiat Makcayathorn, a director of the Thai Rice Exporters Association.

Thai rice has only about a 30% share of the Asean market, down from as much as 60% five years ago, as key buyers including Singapore, Malaysia and the Philippines have turned to Vietnam.

Vietnam last year exported 6.5 million tonnes of milled rice, with the figure for the first five months of this year totalling 3.1 million, slightly lower than 3.3 million tonnes for Thailand, said Mr Somkiat.

"More importantly, Vietnam's rice exports are mainly in the form of white rice, while Thai rice shipments have parboiled and glutinous rice combined.''

Vietnam last year exported 2.8 million tonnes to the region, mainly to the Philippines, Malaysia and Singapore, while Thailand's figure was only 640,000 tonnes out of 8.5 million globally.

Mr Somkiat also warned Thailand could no longer be complacent about quality, as the renowned aroma of Thai Hom Mali rice was not considered as good as it was five years ago.

More worrying is the fact that Cambodia has adapted some Thai Hom Mali varieties and ships the paddy to Vietnam, capitalising on the free trade pact.

Source: Bangkok Post