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Thailand to gain from lower rice supply

Nov 16. 2015
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THE COMMERCE Ministry is set to release 13 million tonnes of rice from the government's stockpiles by the end of 2018, while it expects Thailand to export at least nine million tonnes of rice next year due to lower-than-normal rice supplies globally becau
The ministry also expects rice shipments to reach 10 million tonnes this year, with shipments of about eight million tonnes worth US$3.8 billion (Bt127 billion) between January 1 to November 10.
Chutima Bunyapraphasara, permanent-secretary to the ministry, said yesterday that the government was confident it would clear the stockpiles within the next two years as many countries had lower rice stocks because of the El Nino climate effect.
She said that the government set up a strategy to release rice from the stockpiles in June 2014. 
“So far, from about 18 million tonnes of rice in stockpiles, about 13 million is remaining and this amount should be release continuously,” she said. The government is scheduled to sign a rice contract with the Chinese government on December 19 that will result in a second shipment of rice to China under a government-to-government deal for one million tonnes of rice. 
The first G-to-G between Thailand and China for one million tonnes of rice will be completed early next year. Thailand has already shipped about 800,000 tonnes of rice to China.
 Thailand will soon sign a contract to sell 500,000 tonnes of rice to the Indonesian government.
 Chutima said that in 2016 the ministry would continue its plan to release rice from stockpiles, while also help promote the sale of rice in a bid to ensure farmers have stable incomes.
Thailand is expected to produce about 10 per cent less rice than normal next year due to the drought impact and limitations in growing second crops.
With a lower supply to the market, the price should increase and create a better return for farmers, the ministry said. The ministry reported that since August last year until now, the government had sold about five million tonnes of rice worth Bt52.3 billion. 
From the total stock of 13 million tonnes, about six million tonnes is good quality, while six million tonnes is a lower quality that can be upgraded to mixed rice or used for industrial supply. The remaining 700,000 tonnes is rotten rice, which can not be consumed and can only be sold for non-food industrial and biomass production.
The ministry will suspend releasing the good quality rice from the government’s stockpiles until March next year when the current main-crop rice harvest season ends.

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