High cost to pull down Thailand's rice exports in next decade: UTCC
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Thailand's share in the international rice market will drop further in the next 10 years if the plantation system is not altered to lower the production cost, said an academic of the University of Thai Chamber of Commerce.
UTCC's Foreign Trade Study Department Director Att Pisanwanich estimated that at the current cost, the export value would drop by Bt87 billion in the next decade or Bt8.7 billion per year.
He urged the government to subsidise 20 per cent of production cost, while relevant government agencies should mobilise efforts to overhaul the production process. He also said that the rice sector would survive if it is free from political intervention.
The university's study shows that due to high production cost, Thailand's rice is more expensive than that from other countries. The production cost rose from Bt4,835 per rai in 2004 to Bt10,685 in 2013. However, the yield stayed unchanged at 450 kg per rai, against 1,200 kg in Vietnam.
The lower production cost in Vietnam allowed the country to quote a lower price, putting pressure on Thailand's rice exports.
UTCC's study showed that during 2004-2013, Thailand's rice export value dropped sharply from Bt94 billion per annum during 2004-2008 to Bt56 billion per annum during 2009-2013.
