Mon, June 27, 2022

business

Thai rice exports lose ground, prices tumble as India, VN go in for price undercut


Millers are buying paddy rice at much cheaper prices amid hardships faced by farmers after exports witnessed a drop because of price undercutting and strong competition from other countries, experts said.

The prices of paddy rice bought by millers have fallen by 200 to 500 baht per tonne after the cost of exported white rice dropped significantly, from US$960 (33,958 baht) for jasmine rice and $463 (16,370) per tonne for 5 per cent white rice on June 8 to $905 and $427 respectively on Wednesday.

Thai Rice Exporters Association president Charoen Laothamatas attributed the drop to a price undercut by India and Vietnam.

He said India now exports white rice at $338 per tonne while Vietnam sells it for $418, compared to the Thai price of $427. Vietnam sells jasmine rice at $523 per tonne and Cambodia $880, while Thai jasmine rice costs $905.

“The prices of Thai rice are much less competitive,” Charoen said.

Major US shippers have managed to reclaim their containers stranded at major ports so they can provide increased shipping services to rice exporters, thus allowing the market to witness high supply, he said.

India, which is a major rice exporter, has put a lot of its rice on sale and has won most purchasing orders from key markets, especially African nations, Charoen said.

India has not been hit by a drought this year and farmers there have switched to higher-yield species, so the country is in a position to export more rice at competitive prices, he pointed out.

“India is closer to Africa than Thailand is and of course it has its own ports so Thailand cannot compete in exporting rice to African nations,” Charoen noted.

He said it was fortunate that Iraq recently purchased 400,000 tonnes of Thai rice or else the prices would have plunged much deeper.

The on-going harvest of the second crop of off-season rice, which will continue into August, has seen a lot of paddy rice flood the market, prompting local prices to go down as well.

Charoen said Thailand is now banking on hopes of selling rice to Saudi Arabia as people there like to consume long, hard grain rice, a variety produced by Thailand.

Meanwhile, Thai Rice Mills Association president Rangsan Sabaimuang said the fluctuating prices in the global rice market have affected domestic prices.

The local prices of jasmine rice in the country now vary from 13,500 baht to 13,700 baht per tonne, compared to 14,000 and 14,500 baht earlier.

Thai Agriculturist Association president Pramote Charoensilp also confirmed that the current harvest has led to rice flooding the market, bringing prices down.

He said his association would consult government agencies on how to help affected farmers.

Published : June 23, 2022

By : THE NATION