Vietnam Poised To Topple Thailand As World's Largest Rice Exporter

[DP25]

A few years ago, concerned private-sector groups had warned the government that there was a risk Thailand would lose its No 1 position if the government continued to subsidise rice prices, creating unreasonably high prices both domestically and for export.

I may not be an expert at economics, but I understood that when a government subsidises a commodity, it results in lower prices, not higher ??

All I know is that I am paying double the price for rice now compared to about 3 years ago. Are the farmers actually receiving any benefit from these higher prices?

Normally that is true but in this case the government is subsidising rice by buying it above market rates. They are spending money to raise the price.

And no the actual farmers recieve little benefit, it is mostly going to middlemen who make huge amounts of money from this scheme

[lovelomsak]

In my humble opinion this is a none issue. Thailand will be the major buyer of Vietnam rice and sell to the rest of the world. Vietnam and Thailand will deal in baht which will be to the advantage of both countries for asian trade. Thailand will simply be in control of the rice trade for asia.

Why am I always suspicious when people say things are simple? Why on earth do you think Vietnam, a fierce competitor, will allow Thailand to monopolize its rice trade? Or perhaps you were being facetious.... ;-)

I like your suspicions. The reason Vietnam will sell to Thailand is they will want the baht more than the American dollar for trading within Asia. The strenght of the baht and stability, has more value for local trading (Asia) than the American buck.Vietnam is willing to let China and Thailand deal with the American dollar trading.The rice can still be shipped from Vietnam around the world but before it leaves the dock it will be owned by a Thai company.

what a load of crap u speak - no idea ...

One persons crap is anothers bio fertilizer. To help you understand this. Did or didnot Thailand and China recently sign an agreement to trade in their currencies up to a certain amount over a certain period of time, rather than use american dollars for the trade? Could you possibly conceive the idea that this maybe the way of the future for Asia?And Thailand has been working hard through crises after crises to maintain a stable currency to make this happen.

If you donot see the advantage here to Asia as a whole and Thailand and China specific then we shall have to let time be your teacher.

[janverbeem]

Will not just topple Thailand in rice exports, Vietnam is becoming a destination of choice for tourism in S/E Asia as well. Cheap flights, accomadation and attractions. The country has everything that Thailand has with less scams and 1/2 the price. Whilst the rest of S/E Asia is paddling down stream with the current, Thailand is paddling up stream with one paddle. Time to turn around and go with the flow.

Hey,may be Thailand can be the hub of Vietnamese rice.

[Thai at Heart]

How much of Thailands crop was wiped out by the flood?

Vietnam target exports 2012 : 7.3 million tonnes

Thailand : 6.5 million tons

Anyone know the difference in value ot the exports of these two origins? thailand will win in value I would presume.

[anterian]

I think most people understand terms like "market research", "forward planning" , etc. It would seem that those who control Thailand can not be included in the term "most people" !!

[bkk_mike]

A few years ago, concerned private-sector groups had warned the government that there was a risk Thailand would lose its No 1 position if the government continued to subsidise rice prices, creating unreasonably high prices both domestically and for export.

I may not be an expert at economics, but I understood that when a government subsidises a commodity, it results in lower prices, not higher ??

All I know is that I am paying double the price for rice now compared to about 3 years ago. Are the farmers actually receiving any benefit from these higher prices?

It depends how the price subsidies work...

In the EU, it means basic foodstuffs are more expensive within the EU as farmers have a minimum price that they can get, so don't need to accept less than that. However, the food the governments buy tends to be sold in the rest of the world for less than they paid for it (just not inside the EU).

i.e. European taxpayers subsidise food costs for the rest of the planet, while making their own food more expensive, all to benefit farmers who now farm according to subsidy because it would be stupid to do otherwise. With unintended consequences like pricing African farmers out of business in their own countries (which is why they then invented schemes like paying farmers to not farm on a portion of their land...)

[RogueLeader]

A few years ago, concerned private-sector groups had warned the government that there was a risk Thailand would lose its No 1 position if the government continued to subsidise rice prices, creating unreasonably high prices both domestically and for export.

I may not be an expert at economics, but I understood that when a government subsidises a commodity, it results in lower prices, not higher ??

All I know is that I am paying double the price for rice now compared to about 3 years ago. Are the farmers actually receiving any benefit from these higher prices?

It depends how the price subsidies work...

In the EU, it means basic foodstuffs are more expensive within the EU as farmers have a minimum price that they can get, so don't need to accept less than that. However, the food the governments buy tends to be sold in the rest of the world for less than they paid for it (just not inside the EU).

i.e. European taxpayers subsidise food costs for the rest of the planet, while making their own food more expensive, all to benefit farmers who now farm according to subsidy because it would be stupid to do otherwise. With unintended consequences like pricing African farmers out of business in their own countries (which is why they then invented schemes like paying farmers to not farm on a portion of their land...)

It's even worse than that now. I was talking to a (British) farmer in India last year and British farm subsidies are now paid according to the acreage of land that you own. Nothing more, that's it. What's more, the subsidies are regressive, a sliding scale increasing according to how much land is owned by the crofter, farmer, co-operative or (increasingly) agri-business.

The effect of all this is to discourage efficiency and encourage concentration of land ownership by monoculture agri-businesses that produce massive amounts of the wrong types of raw materials which are then coaxed into a food-like state.

The reality is, though, that without farm subsidies of some kind, most European farms would simply cease to exist. The real blame lies with organisations such as the IMF who encourage, coerce and bully nations into removing trade protectionism, placing them at the mercy of a global market. It all results in a race to the bottom.

There are worse things than a little trade protectionism.

The French do it right. They use farm subsidies to encourage small farms to produce relatively small yields of excellent food and their consumers demand nothing less.

Edited January 18, 2012 by RogueLeader

[maprao]

My impression is that Vietnam wishes to topple Thailand's predominance in the region on many fronts. Rice is but one of them. Thailand should not be complacent, as Vietnam is highly motivated, competitive, and gaining socio-economic ground rapidly.

I hope they can create a nice family resort like we have in Patters..........where do i sign up?

[ajarnmark]

Has anyone ever tried Vietnamese rice? It is crap like hell...

As for India... they buy Pakistani rice and re-package it as Indian rice... amazing country...

[LeeKat]

30 years ago the Vietnamese imported rice for their own domestic consumption. 30 years on they overrun the Thais because a) they got their act together and the government does not screw around with water management by the ignorant agriculture ministry and is, by all standards, considerably less corrupt. In 30 years Thailand will be behind Myanmar and Philippines combined but this is no longer my problem then.....

What a load of bullshit!!!

[Macmundi]

Thailand was once a leading world producer of rice. But that was long gone when people started selling off their farmlands for a few bahts to get a better life. Whether they did or not, nevermind. But with that kind of attitude, What was once a backbone for Thai exports slowly diminished. Vietman, India, and most of all, China, has all the signature characteristics of Thailand's once 'best rice'. Their prices are lower and availability certain. It takes a miracle to turn Thailand back to what once was glory.

[tomyummer]

The country is too proud of their rice. Getting cocky while neighboring countries pass by. Japanese rice is better than jasmine anyway. It holds moisture better. Jasmine rice is overrated.

Edited January 27, 2012 by tomyummer

[DeepInTheForest]

Thailand was once a leading world producer of rice. But that was long gone when people started selling off their farmlands for a few bahts to get a better life. Whether they did or not, nevermind. But with that kind of attitude, What was once a backbone for Thai exports slowly diminished. Vietman, India, and most of all, China, has all the signature characteristics of Thailand's once 'best rice'. Their prices are lower and availability certain. It takes a miracle to turn Thailand back to what once was glory.

Did you check facts before making your assertion? It is true that Thailand will face problems with selling its rice, but that will not be due to lack of production.

http://www.businessweek.com/news/2012-01-19/thai-rice-production-seen-climbing-to-record-after-floods.html

Vietnam has problems of their own relating to land degradation. One concern is the huge amount of defoliants deposited on the country during the American War, some of which left dioxin. Vast amounts of forest were also lost as a result. Another is the salinization of the Mekong Delta. The proposed dams on the Mekong would inflict extreme damage on the Vietnamese rice bowl.

http://talkvietnam.com/2011/10/vietnam-deal-land-pollution-degradation/