Race for top rice exporter set off

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India is about to become 2012’s top global rice exporter with estimated 7 million tonnes

Thailand’s 30-year reign as the world’s top rice exporter could come to an end very soon as Vietnam and India threathen the Kingdom in its role.

Favourable weather and higher government support both in India and Vietnam boosted harvests to a record high. India will export up to 7 million tonnes of rice this year, more than double shipped in 2011 , according to statistics from the Ministry of Agriculture in New Delhi.

Vietnam, currently the world’s second-largest rice exporter after Thailand, aims to ship at least 6-7 million tonnes of the grain a year until 2015, the government said, nearing the record shipment of 7.2 million tonnes in 2011.

According to the Thai Rice Exporters’ Association, Thailand has exported 10.3 million tonnes of rice in 2011, an increase of almost 30 per cent over the previous year. However, export has been slowing down recently due to a wrong management of the country’s generous rice-pledging scheme for farmers, the association said.

By mid-2012, India had already eclipsed Thailand as the world’s largest rice exporter, with year-to-date overseas shipments of 3.61 million tonnes, while Thai exports in the period slumped by 45.8 per cent to 3.6 million tonnes. Vietnam shipped 3.52 million tonnes in the same period.

“This is the first time in half a century that Thailand has lost its position as top rice-exporting nation,” the Thai Rice Exporters’ Association complained.

According to the traders group, the main problem was Thailand’s subsidy policy for rice farmers. The government led by the populistic Pheu Thai party pays farmers more than double the market value for rice and stockpiles the crop until it can be sold off on the world market for a higher price. However, with dropping rice futures and the strength of the baht Thailand has a hard time to remain competitive.

The most traded variety, 25 per cent broken long-grain white rice, currently costs as much as $520 a tonne from Thailand compared with $385 a tonne from India and $380 from Vietnam.

The low price from India is pushing the world rice price further down, and Vietnam also reduced its price to even lower than the Indian price in February.

“If the Thai government contiunues with its policy, the Thai rice industry will be heading into a desaster,” association chairperson Kobsuk Iamsuree said

“Trading would be in limbo, while farmers would face a domino effect and be unable to sell their rice because of millers being faced with excess stocks,” she added.

“And if the government cannot sell the expensive rice on the world market,it would soon lack the funds to continue its subsidisation of the next harvest season.”

Currently, about 12 million tonnes of rice is warehoused in the Thai government’s stockpiles, the highest level in 50 years of trading, according to data from the association.

With the overly high export prices and the big floods of November 2011 which affected 70 per cent of the storehouses and processing workshops, Thai rice exporters are worried that the rice export volume of the country would fall by a half in 2012 to around 5 million tonnes.

Thailand’s permanent secretary for commerce, Yanyong Puangraj, denied in a statement on July 26 that Thailand would fall back behind Vietnam and India in rice exports at least in value. He said that the Thai government will continue to pay high rice prices to farmers in order to raise their income.

He argued that the other two major exporters were focusing on increasing quantity of their rice export, while Thailand is focussing on exporting  high quality rice to gain higher prices.

 

 

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Reading Time: 2 minutes

India is about to become 2012’s top global rice exporter with estimated 7 million tonnes

Thailand’s 30-year reign as the world’s top rice exporter could come to an end very soon as Vietnam and India threathen the Kingdom in its role.

Reading Time: 2 minutes

India is about to become 2012’s top global rice exporter with estimated 7 million tonnes

Thailand’s 30-year reign as the world’s top rice exporter could come to an end very soon as Vietnam and India threathen the Kingdom in its role.

Favourable weather and higher government support both in India and Vietnam boosted harvests to a record high. India will export up to 7 million tonnes of rice this year, more than double shipped in 2011 , according to statistics from the Ministry of Agriculture in New Delhi.

Vietnam, currently the world’s second-largest rice exporter after Thailand, aims to ship at least 6-7 million tonnes of the grain a year until 2015, the government said, nearing the record shipment of 7.2 million tonnes in 2011.

According to the Thai Rice Exporters’ Association, Thailand has exported 10.3 million tonnes of rice in 2011, an increase of almost 30 per cent over the previous year. However, export has been slowing down recently due to a wrong management of the country’s generous rice-pledging scheme for farmers, the association said.

By mid-2012, India had already eclipsed Thailand as the world’s largest rice exporter, with year-to-date overseas shipments of 3.61 million tonnes, while Thai exports in the period slumped by 45.8 per cent to 3.6 million tonnes. Vietnam shipped 3.52 million tonnes in the same period.

“This is the first time in half a century that Thailand has lost its position as top rice-exporting nation,” the Thai Rice Exporters’ Association complained.

According to the traders group, the main problem was Thailand’s subsidy policy for rice farmers. The government led by the populistic Pheu Thai party pays farmers more than double the market value for rice and stockpiles the crop until it can be sold off on the world market for a higher price. However, with dropping rice futures and the strength of the baht Thailand has a hard time to remain competitive.

The most traded variety, 25 per cent broken long-grain white rice, currently costs as much as $520 a tonne from Thailand compared with $385 a tonne from India and $380 from Vietnam.

The low price from India is pushing the world rice price further down, and Vietnam also reduced its price to even lower than the Indian price in February.

“If the Thai government contiunues with its policy, the Thai rice industry will be heading into a desaster,” association chairperson Kobsuk Iamsuree said

“Trading would be in limbo, while farmers would face a domino effect and be unable to sell their rice because of millers being faced with excess stocks,” she added.

“And if the government cannot sell the expensive rice on the world market,it would soon lack the funds to continue its subsidisation of the next harvest season.”

Currently, about 12 million tonnes of rice is warehoused in the Thai government’s stockpiles, the highest level in 50 years of trading, according to data from the association.

With the overly high export prices and the big floods of November 2011 which affected 70 per cent of the storehouses and processing workshops, Thai rice exporters are worried that the rice export volume of the country would fall by a half in 2012 to around 5 million tonnes.

Thailand’s permanent secretary for commerce, Yanyong Puangraj, denied in a statement on July 26 that Thailand would fall back behind Vietnam and India in rice exports at least in value. He said that the Thai government will continue to pay high rice prices to farmers in order to raise their income.

He argued that the other two major exporters were focusing on increasing quantity of their rice export, while Thailand is focussing on exporting  high quality rice to gain higher prices.

 

 

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