Leading exporters have urged the government to release older rice from its stockpiles because of the continuing drop in the country's export competitiveness, a situation that will make it increasingly difficult for the Kingdom to regain its status as the its status as the world's rice-export champion.

Thailand lost its decades-long position as the world's top rice-exporting nation last year, and is again being outpaced by India and Vietnam this year.

A source from a giant rice-export company said the government should release its older stockpiles for use in feed-meal production, to make way for new-harvest rice that will need to enter the warehouses.

"The government needs to clear its rice stocks urgently, in particular rice from previous harvests since 2005 because it is deteriorating in quality. These rice stocks could be used for supplying feed-meal producers," said the source.

According to a Commerce Ministry report, about 344,000 tonnes of rice from the 2005-2011 harvest seasons are stored in the government's warehouses. The government has to spend about Bt860 a tonne for stocking the produce per month, while the quality of the rice has inevitably deteriorated over time.

A rice-trader source has also urged the government to release more rice from its stockpiles, so that more is available in the market to support increased exports this year.

Most rice grain continues to enter the government's pledging project because of the high guaranteed price. This means that exporters and millers have less capacity to compete with the government in purchasing rice from farmers, and more rice therefore needs to be gradually released from the stockpiles to support export growth, said the source.

According to the latest data, rice exports have continued to drop, with the Kingdom still ranked the world's third-largest exporter this year.

Export volume dropped 9.3 per cent year on year to 1.37 million tonnes in the January-to-March quarter. India, which was ranked the world's top exporter last year, shipped 1.53 million tonnes in the first two months of this year, a decrease by 2.5 per cent compared with the same period last year.

Vietnam has maintained its position as the second-largest exporter with volume reaching 1.45 million tonnes in the first quarter, an impressive increase of 33.5 per cent over the same period last year.

The Thai Commerce Ministry has reported a total of about 12.39 million tonnes of rice in its stockpiles. The Kingdom is to date committed to shipping 8.92 million tonnes overseas this year.

However, last month alone, shipments of Thai rice dropped by 28.7 per cent year on year to 328,008 tonnes.

The US Department of Agriculture's "World Market and Trade" report forecasts that Thailand's rice stock will increase by 24.65 per cent to 11.63 million tonnes by year-end.

Tikhumporn Natvaratat, the Foreign Trade Department's deputy director-general, said the Commerce Ministry was drawing up a plan to release rice from the stockpiles soon.

Officials are taking into consideration demands from rice traders and the market as to how much should be released, he said.

In a related matter, 500 international rice traders will gather in Chiang Mai for the sixth "Thailand Rice Convention Summit" from May 26-28, hosted by the Commerce Ministry in an effort to promote Thailand as the world's leading rice supplier in terms of both quality and volume and emphasise the country's position as an Asean rice-trading hub.

Pranee Siriphand, director-general of the Foreign Trade Department, said the event aimed at brainstorming ideas for development of the rice industry, as well as emphasising Thailand's status as the world's rice-trading centre.

Many experts and traders from overseas have been invited. Participants are expected from Indonesia, the Philippines, Malaysia, Singapore, Brunei, China, Saudi Arabia, Bangladesh, Nigeria and Senegal, all of which are rice-importing countries. There will also be representatives from Vietnam, Myanmar, Cambodia and Laos, which are exporting nations.

The government plans to set up a central market and futures market to emphasise Thailand's position as the global rice-trading centre. It will also focus on how to increase innovation in rice production and tighten cooperation with other trading nations.

Business-matching between Thai rice exporters and international traders will be conducted at the event, Pranee said.

Representatives from other nations' governments will also take part with a view to increasing trading opportunities for stockpiled Thai rice.

Source: The Nation