Costly Thai rice is expected to prompt more Thai exporters to procure and sell rice from overseas in lieu of Thai grains, or even relocate their milling base to neighbouring countries.

"We insist we are not running against the government's rice pledging policy, but we need to adapt to stay afloat," Kiattisak Kanlayasirivat, president of Novel Agritrade (Thailand) Co, said at a seminar on the future of Thai rice in the world market.

"In the past, any exporter who sold the rice of other countries was labelled unpatriotic. But now things have changed, as all parties admit and agree that the price of Thai rice is much higher."

Wanlop Pichpongsa, deputy managing director of Capital Rice Co, STC Group's rice-exporting flagship, concurred that investment expansion in other countries and the sale of foreign rice instead of Thai rice are being planned.

"In the future," he said, "we will have to pay attention to productivity, rice quality, marketing and government policies, especially those that may affect not only farmers but also the private sector, the rice farmland owners and the rice trading partners."

STC Group, Thailand's biggest rice exporter, recently said it was exploring investment opportunities in Cambodia, including a venture with a local partner in rice processing, logistics and exports from the country.

STC is among several Thai investors eyeing the thriving rice industry in Cambodia, which plans to export 1 million tonnes over the next few years.

Among the prominent companies is Asia Golden Rice, a leading rice exporter that seeks to pour 1.5 billion baht into processing 1 million tonnes of rice a year in Cambodia's southern province of Kampot.

Thiti Lujintanon, vice-president of CP Intertrade, said the Thai rice price is unlikely to drop, as it is a political crop.

Source: Bangkok Post