BANGKOK: The commerce ministry will continue to suspend the release of rice from government stockpiles until next year to ensure that the market price of rice does not fall too steeply during the current harvest season, which began early this month and runs until February.
Duangporn Rodphaya, director-general of the Foreign Trade Department, said the government would suspend the sale of consumer-grade and industrial-grade rice as it foresees falling prices amid slowing demand in the world market. She said the market price should not fall too much as the government had announced the rice-release suspension clearly. The government will reopen bidding to continue clearing out the rice stocks in the future if the price begins rising and demand for the commodity increases. During the current main harvest season, about 25 million tonnes of paddy rice will be cultivated from October to February.
Charoen Laothamatas, president of the Thai Rice Exporters Association, agreed with the government’s plan to delay clearing out its stockpiles as the rice price would otherwise drop too much during the harvest season and hurt farmers. He said a large quantity of rice and other grains were expected to hit the market this year, resulting in lower prices of cereals. According to the association, the price of Thai 5 per cent white rice dropped from US$379 per tonne in late September to about $360 per tonne early this month.
With sluggish demand in the global market and lower prices of other countries’ rice, Thailand looks like failing to regain its crown as the world’s largest rice exporter for the second consecutive year, as India has exported larger volumes. During the first eight months of this year, Thailand slipped to second place in the world’s rice-export ranking as India’s rice is cheaper, while that country has large stockpiles of rice.
Thailand exported 6.06 million tonnes of rice in the first eight months, compared with India’s export volume of 6.71 million tonnes, up by 16 per cent over the same period last year. Thailand’s export volume increased by 2.9 per cent, and value rose 1.4 per cent to $2.72 billion.
The current price of Indian 5 per cent white rice is $350 per tonne. Charoen said that during the rest of the year, Thailand was expected to export about 600,000-700,000 tonnes of rice, so full-year export volume of will be 9.5 million tonnes, while India’s tally will end up at about 10 million tonnes. He said orders for rice in coming years would not be as high as previously expected as the Philippines and Indonesia had slowed down their imports of the commodity. China, which is one of Thailand’s major export markets, has also implemented a policy to slow down its grain imports.
