Thailand's hold on the title of world's biggest rice exporter started slipping last month after its exports fell behind those of Vietnam, whose traders are offering attractive prices while Bangkok concentrates on high subsidies to boost domestic prices.
Thailand's hold on the title of world's biggest rice exporter started slipping last month after its exports fell behind those of Vietnam, whose traders are offering attractive prices while Bangkok concentrates on high subsidies to boost domestic prices.
It will not be hard for Vietnam to overtake Thailand to win the export crown this year.
A report of the Thai Rice Exporters Association showed Thailand shipped 387,748 tonnes in January, the lowest performance in more than a decade, since 375,246 tonnes were sent abroad in March 2001. In that year, Thai rice exports reached 7.52 million tonnes.
The Vietnam Food Association reported on Thursday that Vietnam exported 400,000 tonnes in January, leading to increased confidence that the country will achieve its export target of seven million tonnes this year.
Some foreign buyers also think that Vietnam will pass Thailand, which should manage a maximum of 6.5 million-7 million tonnes in exports this year due to unreasonable prices. However, the government's export target is 9.5 million tonnes of rice for this year.
In January, Siam Indiga shipped 120,000 tonnes of rice to Indonesia. The company was selected by the Commerce Ministry under "secret bidding" to deliver a total of 300,000 tonnes of government rice to Indonesia.
RICE TRADING DOOMED
Falling shipments have force related export businesses to suspend operations.
Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said last week the trend in January clearly shows that Thailand's export competency is dropping sharp-ly due to higher export prices than its rivals.
"Normally, exports in December and January will be very heavy as that is the harvest season. Exports should reach at least 800,000 tonnes a month," he said.
Rice export volumes have been de-clining steadily since October when the government kicked off the pledging project at a high price. Exports have slumped from 824,487 tonnes in September to 603,752 tonnes in October, 469,593 in November and 527,348 in December.
"The high export prices of Thai rice have undermined the Kingdom's competitiveness and made it difficult |to export," he said. The 9.5-million-tonne forecast for this year was questionable.
To achieve the target, Thailand must export at least 800,000 tonnes of rice a month, or more than one million tonnes a month in the second half, but under the current circumstances, that will not be easy. India has huge stockpiles of rice, while other rivals including Vietnam are enjoying bumper crops.
Another rice trader said that because the government has monopolised rice trading in the country, the rice trading system would be totally demolished in three years.
"Other rice exporters, which have no connection with the government, are being driven out the industry. The government and only a few rice traders close to the government will survive the high intervention and unfair trading system in the country," the source said.
Due to the sky-high price of Thai jasmine rice, export volumes of the premium grade have also plummeted in the past few years, the source said.
Thai hom mali rice is not competitive given its lower quality, as the government has stored the rice for too long.
Buyers now have more choices for fragrant rice, from Vietnam to Cambodia, which have lower prices. Thai jasmine rice exports will continue to drop gradually.
Although the price of jasmine rice is not as high as the pledged price, at $1,050 a tonne, Thai rice is losing opportunities to other fragrant rice quoted at only $820 a tonne, the source added.
Source: The Nation
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