Price Of Rice In Us

[oswald]

For the rice growers, just got back from the discount store (COSTCO),

Thai rice was selling for $9.29 for 25 lbs, American rice (bag said grown

in Texas), $6.49 for 25 lbs, first time I saw American grown rice in that store.

[teletiger]

28.7 Baht per kilo.

Regards

[C-sip-degree]

hel_l it's a hard old life for the Isaan farmer selling it for 9Bht a KG if your lucky!!!

regards

C-sip

[Somtham]

hel_l it's a hard old life for the Isaan farmer selling it for 9Bht a KG if your lucky!!!

regards

C-sip

Rice farmer gets B9/kg and shipping costs maybe around B8/kg so B17. Nice profit for CostCo/importers....60%!!!

[Loom]

I thought the Thai government controls the domestic price paid to farmers? I've seen reports that they sometimes budget funds to buy up rice for storage. I've never heard the specific branch of government that's doing this though.

[chownah]

World rice prices are a result of supply and demand. If some company is charging too much for their services then their prices will be too high and others will get their business. If you think you can give the farmers a better price for their rice and then sell it in the US then go ahead and do so...you'll be a big hero....you'll also be dreaming.

Chownah

[Somtham]

World rice prices are a result of supply and demand. If some company is charging too much for their services then their prices will be too high and others will get their business. If you think you can give the farmers a better price for their rice and then sell it in the US then go ahead and do so...you'll be a big hero....you'll also be dreaming.

Chownah

Huh? A+B=C. How did you jump to D? Where did somebody mention buying rice locally and then selling elsewhere to be a broke " big hero"?

rgds

[Loom]

I was just trying to point out that the margin for Costco and importers probably isn't anywhere near 60% because of middlemen all taking a piece of the pie along the distribution chain. Was also just wondering out loud if anyone knows the extent to which the Thai government, if at all, is involved in price setting and international trading. I am wondering about this because I would agree that farmers are probably getting the short end of the stick. But it's not only because Costco and other retailers are getting a margin. There's probably limited competition in Thailand among the buyers involved in the export trade and that's where some of the profit is also going. I believe rice exports are controlled by the government or some sort of monoploy so it would be impossible for anyone else to buy at a higher price from the farmers to resell in the export market.

[chownah]

World rice prices are a result of supply and demand. If some company is charging too much for their services then their prices will be too high and others will get their business. If you think you can give the farmers a better price for their rice and then sell it in the US then go ahead and do so...you'll be a big hero....you'll also be dreaming.

Chownah

Huh? A+B=C. How did you jump to D? Where did somebody mention buying rice locally and then selling elsewhere to be a broke " big hero"?

rgds

Huh? What's up.

[Loom]

World rice prices are a result of supply and demand. If some company is charging too much for their services then their prices will be too high and others will get their business. If you think you can give the farmers a better price for their rice and then sell it in the US then go ahead and do so...you'll be a big hero....you'll also be dreaming.

Chownah

Supply and demand in the international market, yes.

But it doesn't seem to be a competitive market in Thailand and that may be why US milled prices have roughly doubled in the past few years while Thai prices have gone up only about 50%. Also Thai rice export prices are about 25% lower than US export prices. The price figures I'm looking at come from the USDA's Rice Outlook.

[C-sip-degree]

World rice prices are a result of supply and demand. If some company is charging too much for their services then their prices will be too high and others will get their business. If you think you can give the farmers a better price for their rice and then sell it in the US then go ahead and do so...you'll be a big hero....you'll also be dreaming.

Chownah

Chownah,

In a dream I had, 'I would love too give the farmers a better price for their rice' or even ideas on how too do.

But as time when on and the rice pile got bigger or the team got larger, 'I think I would get to worried about getting shot'.

That's E by the way short for (end).

regards

C-sip

[chownah]

Rice farmers don't have to sell their rice to the gov't.....we don't. Most of the rice grown around here is consumed around here. I don't know the laws about exporting rice. I always thought that the gov't subsidized the price to farmers and kept it higher than what a free market would provide....maybe I'm wrong though.

[chownah]

From this link:

http://www.riceonline.com/home.shtml

the price of Thai rice (high quality) for export was $328 per 1000kg bagged FOB.

That comes to $0.328 per kilo which comes to about 11.5 baht per kilo at 35 baht per dollar....or about 10.6 baht per kilo at 32.5 baht per kilo.....I don't know whether to use the onshore or off shore exchange rate so I have reported both.

Seems like the price this year for paddy rice was 10 baht per kilo...but remember that this is paddy and about 20% of this is (maybe more...can't remember the exact figures now) gets stripped off in the milling process...so...adjusting for this loss factor means that since a farmer is getting paid 10 baht for 0.80 kilo of milled rice they produce means they are getting paid 12.5 baht per kilo of milled rice they produce.

Then consider the cost of shipping the rice, milling it, bagging it, and loading it on the ship....plus the cost of business overhead for selling it overseas........

Seems like the gov't is assuredly subsidizing the price of rice to the farmer. I very well could be making some stupid errors here and I hope that someone will check this out more fully and let us know if this is correct or not.

Just as a comparison (although it might not be appropriate) the price paid to farmers for corn in the US before the ethanol boom was about 0.10 US dollar per kilo...which comes to about 3 baht per kilo.

Chownah

[Loom]

From this link:

http://www.riceonline.com/home.shtml

the price of Thai rice (high quality) for export was $328 per 1000kg bagged FOB.

That comes to $0.328 per kilo which comes to about 11.5 baht per kilo at 35 baht per dollar....or about 10.6 baht per kilo at 32.5 baht per kilo.....I don't know whether to use the onshore or off shore exchange rate so I have reported both.

Seems like the price this year for paddy rice was 10 baht per kilo...but remember that this is paddy and about 20% of this is (maybe more...can't remember the exact figures now) gets stripped off in the milling process...so...adjusting for this loss factor means that since a farmer is getting paid 10 baht for 0.80 kilo of milled rice they produce means they are getting paid 12.5 baht per kilo of milled rice they produce.

Then consider the cost of shipping the rice, milling it, bagging it, and loading it on the ship....plus the cost of business overhead for selling it overseas........

Seems like the gov't is assuredly subsidizing the price of rice to the farmer. I very well could be making some stupid errors here and I hope that someone will check this out more fully and let us know if this is correct or not.

Just as a comparison (although it might not be appropriate) the price paid to farmers for corn in the US before the ethanol boom was about 0.10 US dollar per kilo...which comes to about 3 baht per kilo.

Chownah

Hmmm...your numbers look right.

The US rice growers are getting significant government subsidies and that might explain why US export prices are higher and have increased more than in Thailand. There may also be quality differences.

I found an interesting article (link below) from the Oxfam website discussing how the US is demanding countries around the world to lower their import barriers to buy subsidized US rice.

http://www.oxfam.org.uk/what_we_do/issues/..._rice_green.htm

From going over the USDA's global rice inventory data, the good news is that inventories are near 20 year lows so prices are unlikely to go down anytime soon and there could even be more upside from levels reached in recent years.