Thai Rice Exports: 'Sector May Be Heading For Disaster'

[SouthernMan3]

"The government should, therefore, devise a strategy to release rice at an acceptable price and with the minimum impact on exporters' continued ability to operate, he suggested."

Ya think ?

And let's forget about the minimum impact on growers shall we.

[geriatrickid]

You are making excuses. Phua Thai didn't know that would happen. India sorted out a great deal and you degenerate it. Thailand has a crap policy you defend it against other countries. Wow.

But OK. Let's see how Phua Thai manage "one countries catastrophes are another's opportunity "

They should be able to shift the excess rice stock easily. That's right isn't it GK.

Sent from my GT-P1010 using Thaivisa Connect App

Not making excuses. I am asking why the global commodity market is not taken into consideration. India's is the most oil dependent grain producer in the world. If India had not been able to obtain the Iranian oil at below market cost, it would not have been able to subsidize its rice producers and exporters this year. I don't think the situation will be as favourable for India next year. Nor has India sorted out anything. The fact is that the rains came at the right time during the growing season, a situation that had not occurred in previous years. The Indian agricultural sector is still a mess to the point where Thailan appears efficient and well managed in comparison.

Although corn and rice are not easily exchangeable grain commodities,surplus corn has often been dumped out of the North American market at prices below that of rice. Now that the surplus corn is not available, rice exporters will have an opportunity. I acknowledge that other countries have had bumper harvests this past year. Good for them and good for the world. Unfortunately, in agriculture, weather can be very different in the next growing season. Changes in management strategy take several years to take full effect. One cannot really pass judgement on the strategy for another 1-2 years. Had the grasshopper plague continued in Vietnam and China's floods occurred a few months earlier the Thai strategy would be hailed as brilliant. The flooding in China has significantly damaged the agriculture sector and this will take 6-12 months to show up. It will be interesting to see what China does then. As for India, watch what happens once India cannot circumvent the Iranian oil sanctions.

[gtm2k]

Som nom na. Thai's still think there number one and wont be beaten.. aint that a slap in the face.

They still think they are number one and that all the stats and news is BS !!! Apparently the quality of thai rice is so good, that nobody wants to buy it !!

quoted directly from the post today ...

".....Responding to remarks by Thai rice traders that Thailand had dropped to third place as a rice exporter, Mr Yanyong said this was not correct. The country was still the world's largest rice exporter, shipping out as much as 3.7 million tonnes of rice over the past six months.

He admitted the amount of rice exported by India and Vietnam had substantially increased because the two major exporters were focusing on increasing the quantity of their rice exports, while Thailand focused on exporting high quality rice to get higher prices, he said...."

http://www.bangkokpost.com/news/local/304421/thailand-to-remain-top-rice-exporter

[Baloo22]

A few questions for the agriculture experts here.

How does the government store this 12 million tons of rice? In silos? Or is it bagged and stored In warehouses?

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

[sirchai]

This is the first time in half a century that Thailand has lost its position as top rice-exporting nation.

Not just as a rice exporting nation...............

[Moruya]

A few questions for the agriculture experts here.

How does the government store this 12 million tons of rice? In silos? Or is it bagged and stored In warehouses?

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

2 rudiments of wisdom.

All the silos will soon be full. A full vessel speaks words of truth.

The rice barges will all be empty. Empty vessels make the most noise.

And a mathematical paradox for free. Half full = half empty. Until you multiply both sides of the equation by 2.

Now you are an expert in PTP market dynamics

[TommoPhysicist]

It is a grand scheme. When the government can no longer buy rice and the farmers are starving the program will be dropped and the reason being it was a failed scheme of the democrat government and Big T has saved the farmer from ruin. As we know Thais believe anything that Big T says and they will swallow it hook line and sinker as the rice drops in price and Thailand returns to number one, Big T will be the hero

Whilst making your dramatic statement, you forget, if all else fails the farmer can eat the rice they grow and not starve.

We don't sell the rice we grow on our farm, we just keep it for the family and eat it.

[TommoPhysicist]

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

I would say white rice good for 5-10 years if stored correctly

https://www.usaemerg...oods.htm#link16

(some claim good for 25+ years).

http://www.carolinar.../4/Storage.aspx

There are reports that Egyptologists have cooked and eaten white rice stored in tombs for thousands of years and it was still OK.

Edited July 26, 2012 by TommoPhysicist

[waza]

Crop policy leads to failure and long-term damage

The Nation March 17, 2012 1:00 am

Price subsidies on farm produce are reducing Thailand's competitiveness and harming agriculture; it's time to reverse them before it's too late

The government of Prime Minister Yingluck Shinawatra must urgently revise its price-pledging scheme for agricultural products. Although the policy might be able to shore up some farm prices in the short term, it is the wrong kind of incentive to strengthen the position and wellbeing of the nation's farmers.

The government has, since October last year, spent more than Bt300 billion for pledging programmes on rice, cassava, garlic and red onions. The programme has, however, resulted in depressed rice prices instead of shoring them up.

A small group of people has benefited from this populist policy. But the majority has not. The evidence is in a recent series of rallies held by farmers asking for the government to provide them with even more subsidies. Apparently, the policy is not creating a multiplier effect in benefiting a majority of farmers.

If the government does not remedy this situation, it will not only squander a massive budget, but also, in the longer run, entirely wreck the already reduced competitiveness of Thai farmers.

http://www.nationmul...e-30178133.html

I see the rice pledging scheme will result in the same loses as the onion pledging scheme, so far 50% of the stored onions have rotted in storage causing a 500 million baht loss for the Thai treasury. They were stored in a huge pile in a warehouse.

Edited July 26, 2012 by waza

[Bender]

A couple years ago when food price was rising all around the world. Thailand was yelling its the beginning of the golden age for thai rice sector...

[Johpa]

No mention of the out dated, inefficient & environmentally destructive growing methods that farmers insist on sticking to.

Yields could easily be increased with lower overheads if only they would open their minds to change.

Unfortunately your typical small independent rice farmer has long been connected to an economic system that intentionally keeps him poor, or in debt, and with little capital to make significant changes. If a larger percentage of the profits from the sale of rice went to the farmers they might be more willing to accept the risks of investing in change. I think most farmers are happy to try new methods that are explained to them and that cost little to try. But let's be frank, the more efficient methods include mechanical harvesting (as well as mechanical irrigation) which only works on large scale fields.

[lungmi]

You are making excuses. Phua Thai didn't know that would happen. India sorted out a great deal and you degenerate it. Thailand has a crap policy you defend it against other countries. Wow.

But OK. Let's see how Phua Thai manage "one countries catastrophes are another's opportunity "

They should be able to shift the excess rice stock easily. That's right isn't it GK.

Sent from my GT-P1010 using Thaivisa Connect App

Not making excuses. I am asking why the global commodity market is not taken into consideration. India's is the most oil dependent grain producer in the world. If India had not been able to obtain the Iranian oil at below market cost, it would not have been able to subsidize its rice producers and exporters this year. I don't think the situation will be as favourable for India next year. Nor has India sorted out anything. The fact is that the rains came at the right time during the growing season, a situation that had not occurred in previous years. The Indian agricultural sector is still a mess to the point where Thailan appears efficient and well managed in comparison.

Although corn and rice are not easily exchangeable grain commodities,surplus corn has often been dumped out of the North American market at prices below that of rice. Now that the surplus corn is not available, rice exporters will have an opportunity. I acknowledge that other countries have had bumper harvests this past year. Good for them and good for the world. Unfortunately, in agriculture, weather can be very different in the next growing season. Changes in management strategy take several years to take full effect. One cannot really pass judgement on the strategy for another 1-2 years. Had the grasshopper plague continued in Vietnam and China's floods occurred a few months earlier the Thai strategy would be hailed as brilliant. The flooding in China has significantly damaged the agriculture sector and this will take 6-12 months to show up. It will be interesting to see what China does then. As for India, watch what happens once India cannot circumvent the Iranian oil sanctions.

----I am asking why the global commodity market is not taken into consideration.----

Ask the Gouvernment. They have so many future tellers. Why they couldn't predict the development of the global commodity market to save their anti-productive populism.?

[lungmi]

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

I would say white rice good for 5-10 years if stored correctly

https://www.usaemerg...oods.htm#link16

(some claim good for 25+ years).

http://www.carolinar.../4/Storage.aspx

There are reports that Egyptologists have cooked and eaten white rice stored in tombs for thousands of years and it was still OK.

If stored correcly......

[Arkady]

They clearly are heading for disaster. Thai rice exports are going down the tube fast and having a serious affect on trade defecit. What do you expect if you elect a government with the mentality of Wall Street bankers who are only interested in whatever short term rewards they can grab for themselves and don't care if they make the whole economy blow up and all the poor people suffer like hell.

[TommoPhysicist]

They clearly are heading for disaster. Thai rice exports are going down the tube fast and having a serious affect on trade defecit. What do you expect if you elect a government with the mentality of Wall Street bankers who are only interested in whatever short term rewards they can grab for themselves and don't care if they make the whole economy blow up and all the poor people suffer like hell.

To be fair, it wasn't the current government that pushed the Baht up so high against other currencies.

It's not just rice, the exchange rate will soon stop ALL exports from Thailand ...... because other countries are cheaper.

Edited July 26, 2012 by TommoPhysicist

[Arkady]

A few questions for the agriculture experts here.

How does the government store this 12 million tons of rice? In silos? Or is it bagged and stored In warehouses?

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

No need to worry about storing all 12 million tons because some of it will be quietly sold off at a discount by corrupt government officials and politicians. The Public Warehouse Organisation is nearly as bent as the Customs Department.

[BuckarooBanzai]

Well wait for 4 years when China is number 1.

10 years ago India was just importing rice no exporting of rice.

But than Thailand the Medical Center of the World

No Problem

India is a sad case . . better to export than feed it's own population adequately ? . . how sad is that ?

Sure, they might still have a surplus, but first things first.

How does a country take care of it's populace without income? I am astounded at the lack of "overview" demonstrated by posters who always know best how to rule the world. The indians are proving themselves to be one of the most progressively educated countries around. It takes time to change.

Edited July 26, 2012 by BuckarooBanzai

[Steely Dan]

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

I would say white rice good for 5-10 years if stored correctly

https://www.usaemerg...oods.htm#link16

(some claim good for 25+ years).

http://www.carolinar.../4/Storage.aspx

There are reports that Egyptologists have cooked and eaten white rice stored in tombs for thousands of years and it was still OK.

Brilliant, Silo of the Kings coming up.

[Baloo22]

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

I would say white rice good for 5-10 years if stored correctly

https://www.usaemerg...oods.htm#link16

(some claim good for 25+ years).

http://www.carolinar.../4/Storage.aspx

There are reports that Egyptologists have cooked and eaten white rice stored in tombs for thousands of years and it was still OK.

Thanks for the info!

[pattayaorganic]

You are making excuses. Phua Thai didn't know that would happen. India sorted out a great deal and you degenerate it. Thailand has a crap policy you defend it against other countries. Wow.

But OK. Let's see how Phua Thai manage "one countries catastrophes are another's opportunity "

They should be able to shift the excess rice stock easily. That's right isn't it GK.

Sent from my GT-P1010 using Thaivisa Connect App

Not making excuses. I am asking why the global commodity market is not taken into consideration. India's is the most oil dependent grain producer in the world. If India had not been able to obtain the Iranian oil at below market cost, it would not have been able to subsidize its rice producers and exporters this year. I don't think the situation will be as favourable for India next year. Nor has India sorted out anything. The fact is that the rains came at the right time during the growing season, a situation that had not occurred in previous years. The Indian agricultural sector is still a mess to the point where Thailan appears efficient and well managed in comparison.

Although corn and rice are not easily exchangeable grain commodities,surplus corn has often been dumped out of the North American market at prices below that of rice. Now that the surplus corn is not available, rice exporters will have an opportunity. I acknowledge that other countries have had bumper harvests this past year. Good for them and good for the world. Unfortunately, in agriculture, weather can be very different in the next growing season. Changes in management strategy take several years to take full effect. One cannot really pass judgement on the strategy for another 1-2 years. Had the grasshopper plague continued in Vietnam and China's floods occurred a few months earlier the Thai strategy would be hailed as brilliant. The flooding in China has significantly damaged the agriculture sector and this will take 6-12 months to show up. It will be interesting to see what China does then. As for India, watch what happens once India cannot circumvent the Iranian oil sanctions.

GK, so now you are an expert in grains? About as much as you know about prawn farming I see.

First your logical premise that if India hadn't had access to cheap oil that it wouldn't have performed so well. Well what is your point? You are only talking about volumes of production here not benefit. The point is for food production to be sustainable and using billions of dollars of subsidies in a developing country is not sustainable my friend. Secondly, do you think the import of oil directly affects rice producers? To the point that it is refined to diesel and used to power tractors, perhaps, but the petroleum intensity of agriculture is not based on tractor use as much as it is in fertilizer, and agri-chemicals. These are imported and stored so the effect of imported oil doesn't trickle down to the various products immediately but rather takes significant time, so your premise is falsified. The market price transmits information to farmers. The point is not to just produce the maximum amount of rice. The point is to produce a strong variety of foods sustainably while maximizing overall benefits for farmers, and down on the value chain and eventually society as a whole.

When you DOUBLE the market price which is already low (the market is saying, "TOO MUCH RICE") the result is well even more TOO MUCH RICE. Farmers with this perturbed signal now respond my producing even more TOO MUCH RICE. Do you understand anything about market economics? The farmers are paid for brown rice which millers have a monopoly on in Thailand (hint for something to change for REAL revolution). If this price is already at the international rate at the farm gate, how do you expect to pay for the milling, transport, storage costs and profit to the risk takers undertaking this business? How can you possibly imagine a scenario where this would be viewed as a "Brilliant" scheme?

In addition, your above quoted paragraph has more would'ves and could'ves than I have seen in my life. My Gawd man, this government can't even predict if it will rain tomorrow with their pocket calculator weather prediction system and you expect them to outsmart companies like Cargill that have rooms full of Cray Supercomputers and 100s of meteorologists on staff to assist them with hedging their global commodity risks??? It is said that Cargill's ability to predict long term weather events is better than any government on the planet.

As for the corn production in the US, do you really think corn and rice are substitutes to ANY degree? Rice is consumed by humans. Rice bran is widely used in feed, but corn is mostly fed to chickens, pigs and cows to make eggs, chicken meat, pork, beef and milk.

In any case, I go back to my main point that you are only looking at one number, production VOLUME. The point is not to keep Thailand number one in production. I am saddened at the situation in Thailand because I used to write ag-policy in an NGO think tank and Thailand is so back-asswards that just a few simple and low cost changes could show dramatic improvements for Thai food production and rural economic development. This is the true revolution that the reds should be promoting, but instead they worship the false idol that is TS and crew to their own demise.

Oh well finally I have a brilliant idea based on GK logic to solve the world's food crisis and eliminate hunger completely:

LET'S JUST DOUBLE THE MARKET PRICE FOR ALL FOOD! Then farmers will produce more and, hey no more hunger. dam_n, I want to run for President of the world this platform.

FYI, Indian/Vietnamese rice prices (processed) is around 13,000THB per ton. So when the government pays 15,000 baht per ton to the farmers, how do you expect this ever to be sustainable or competitive or brilliant?

Edited July 26, 2012 by pattayaorganic

[thaicbr]

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

I would say white rice good for 5-10 years if stored correctly

https://www.usaemerg...oods.htm#link16

(some claim good for 25+ years).

http://www.carolinar.../4/Storage.aspx

There are reports that Egyptologists have cooked and eaten white rice stored in tombs for thousands of years and it was still OK.

Thanks for the info!

i think this info is telling... Hermetically sealed in the absence of oxygen, plan on a storage life for white rice of 8-10 years at a stable temperature of 70 degrees F.

so that's NOT how its stored here. they use the hessian style bags and load a warehouse from floor to ceiling. this way of storing ???????????????

[DeepInTheForest]

For those who think that India and Vietnam are winning the ag production game: It is one thing to produce tons of rice, it is another to sell it in a glutted market.

Vietnam shipped 756,000 tonnes of rice abroad in the first two months of 2012, generating $437 million in the export value, down 26.6 per cent in volume and 16.1 per cent in value on-year…

Vietnam Food Association (VFA) general secretary Huynh Minh Hue attributed sagging rice export orders to global weakening market demand and fierce competition from rivals in India, Pakistan and Myanmar as these countries offer export prices much lower than those of Vietnam.

http://www.vietnamim...ce-exports.html

India has problems with malnutrition. Should we should celebrate massive rice exports from countries with underweight children?

(from 2010) Across the country, hundreds of millions are malnourished. A study released in May warned that 66% of children under the age of six in Delhi's slums were malnourished. The report noted that the most vulnerable sections of society were not covered under government schemes which were supposed to support them.

In Jharkhand state, a study of 20 villages carried out last year recorded 13 deaths from starvation and 1,000 families suffering from chronic hunger syndrome. It is estimated that each year, nearly 50,000 children in the state die before their first birthday.

http://www.guardian....india-actionaid

And while Vietnam has been praised by the UN for its progress in eliminating hunger, other sources indicate that hunger is still prevalent—the picture is somewhat confusing.

http://www.voanews.c...935/179693.html

http://www.unicef.or...tnam_62201.html

[pattayaorganic]

In a response to rice exporters’ advice to the government to release rice from its stockpile at a loss of an average of $350 per ton, the Thai government has hit back saying that the government is keen to improve the lives of rice farmers and not exporters who have earned handsome profits for years.

Thailand’s permanent secretary for commerce complained that the government has tried to sell rice from its stockpile but every time it did so, the exporters forced prices down.

He said, “Rice exporters have benefited from their business for years. Now the government wants to increase the incomes of rice farmers by setting high rice mortgage prices.”

He added that it is wrong to say that Thailand is lagging behind other countries in rice exports as both India and Vietnam are selling at low prices, while Thailand is concentrating on “exporting of high quality rice, not on quantity.” He said that the government is hopeful that total rice exports this year will reach the targeted 8 million tons.

The Secretary also revealed that the government would not review the rice mortgage program, and farmers would continue to get 15,000 baht per ton for white paddy rice and 20,000 baht per ton for Hommali paddy. A budget of about 200 billion baht is proposed to be allocated for the rice mortgage scheme to cover the crop form the next harvest between October 1, 2012 and February 2013, he said.

The government has spent about 190 billion baht (about $6 billion) to purchase paddy from farmers under the rice mortgage scheme from October 2011 to July 5, 2012.

So, giving the exporters the shaft while helping the farmers (their "pose") when in fact they are giving the money to the village pooyai and giving the taxpayers the shaft. Well I guess this could be called "brilliant"...

$6 billion dollar program in just over half a year. I can think of a few better ways to spend $6B to help improve the lot of Thai rice farmers.

[pattayaorganic]

And how long can they store such amounts of rice before it spoils or the quality degrades to the point where they cannot sell it?

I would say white rice good for 5-10 years if stored correctly

https://www.usaemerg...oods.htm#link16

(some claim good for 25+ years).

http://www.carolinar.../4/Storage.aspx

There are reports that Egyptologists have cooked and eaten white rice stored in tombs for thousands of years and it was still OK.

Thanks for the info!

i think this info is telling... Hermetically sealed in the absence of oxygen, plan on a storage life for white rice of 8-10 years at a stable temperature of 70 degrees F.

so that's NOT how its stored here. they use the hessian style bags and load a warehouse from floor to ceiling. this way of storing ???????????????

For your information, SHINMAI in Japanese is the most sought after, fresh, and hence flavorful and fragrant rice. Even in temperate Japan, we notice a reduction in quality/flavor over a period of 6 months to a year (Japan is a 1 crop/year producer). We used to keep our rice in special rice dispenser containers at room temperature in Japan, but after moving to Thailand we found that the tropical heat and humidity quickly wreak havoc on our rice quality so now we store the rice at 4C or -18C.

Rice in a burlap bag stored in an non-air-conditioned warehouse will not only be subject to infestation by insects, mould, and other microorganisms, but oxidative damage is highly accelerated under these storage conditions (That is why they use non-oxygen environments to extend storage time).

As ThaiCBR correctly points out, the rice is not stored in any conditions similar to these or in any way conducive to long-term quality. The quality degrades noticeably and with an affect on market prices within months of harvest/processing. Brown rice fares better than milled white rice because it retains its natural defense mechanisms.

[Buchholz]

Commerce Minister brushes off criticisms of rice pledging scheme

BANGKOK, 26 July 2012 (NNT) - Commerce Minister Boonsong Teriyapirom has dismissed the speculation that the Thai government’s rice pledging scheme has made the country lose its position as the world’s number one rice exporter.

Boonsong admitted on Thursday that it was understandable for Thai rice exporters to view that the rice mortgage program was hurting Thai rice, making it more expensive than the rice produced by Thailand’s competitors.

However, he said the exporters jumped to the conclusion without taking Thai rice farmers’ quality of life into consideration.

Boonsong explained that the government needed to take care of farmers in accordance with its urgent policy; therefore, the prices of agricultural products had to be set at high levels.

To offset the negative effects, he stressed that the government was urgently distributing a large quantity of rice in the government-to-government (G2G) system with many countries.

The minister also confirmed that the new round of rice pledging would buy rice at the same price as the previous round.

-- NNT 2012-07-26

[Buchholz]

PM assures no funny business in selling Thai rice

BANGKOK, 26 July 2012 (NNT) - Prime Minister Yingluck Shinawatra has insisted that the government has been adhering to the government-to-government (G2G) framework in the sales of Thai rice, without dealing directly with local buyers as speculated.

Prime Minister Yingluck denied that the G2G approach to selling rice under the government’s rice pledging scheme has cost Thailand its rank as the world’s largest rice exporter.

She claimed that the sales of Thai rice have not been conducted only via the G2G agreement, but also via the export of rice acquired from local producers.

Yingluck supported her argument by referring to Commerce Minister Boonsong Teriyapirom’s statement, which claimed that, besides the G2G method, Thailand has also been selling rice through public bidding, which has already been held thrice so far, and that the sales of rice have never been dealt directly with buyers.

The premier said since global consumers are aware of the high quality of Thai rice, it is, therefore, appropriate for the rice to be sold at different rates.

As for the rice export target this year, she said it has been set at 8.5 million tons.

-- NNT 2012-07-26

[Moruya]

PM assures no funny business in selling Thai rice

BANGKOK, 26 July 2012 (NNT) - Prime Minister Yingluck Shinawatra has insisted that the government has been adhering to the government-to-government (G2G) framework in the sales of Thai rice, without dealing directly with local buyers as speculated.

Prime Minister Yingluck denied that the G2G approach to selling rice under the government’s rice pledging scheme has cost Thailand its rank as the world’s largest rice exporter.

She claimed that the sales of Thai rice have not been conducted only via the G2G agreement, but also via the export of rice acquired from local producers.

Yingluck supported her argument by referring to Commerce Minister Boonsong Teriyapirom’s statement, which claimed that, besides the G2G method, Thailand has also been selling rice through public bidding, which has already been held thrice so far, and that the sales of rice have never been dealt directly with buyers.

The premier said since global consumers are aware of the high quality of Thai rice, it is, therefore, appropriate for the rice to be sold at different rates.

As for the rice export target this year, she said it has been set at 8.5 million tons.

-- NNT 2012-07-26

So the numbers are wrong and the numb nuts are right?

[Crushdepth]

The *Commerce Minister* said this? Is he part of the "economic dream team" too

However, he said the exporters jumped to the conclusion without taking Thai rice farmers’ quality of life into consideration.

Boonsong explained that the government needed to take care of farmers in accordance with its urgent policy; therefore, the prices of agricultural products had to be set at high levels.

I know, I know, Thai rice is the best and people will pay anything to get it so we can dictate the price of this commodity...

[Moruya]

The *Commerce Minister* said this? Is he part of the "economic dream team" too

However, he said the exporters jumped to the conclusion without taking Thai rice farmers’ quality of life into consideration.

Boonsong explained that the government needed to take care of farmers in accordance with its urgent policy; therefore, the prices of agricultural products had to be set at high levels.

I know, I know, Thai rice is the best and people will pay anything to get it so we can dictate the price of this commodity...

If I eat rice with food cooked in fish sauce, basil, garlic, chilli etc. etc. It matters not much what rice it is.

I like the smell of jasmine rice but I also like sticky rice and Basmati rice too.

If the Thais lose their customers, it may be very hard to get them back.

[Thai at Heart]

The *Commerce Minister* said this? Is he part of the "economic dream team" too

However, he said the exporters jumped to the conclusion without taking Thai rice farmers’ quality of life into consideration.

Boonsong explained that the government needed to take care of farmers in accordance with its urgent policy; therefore, the prices of agricultural products had to be set at high levels.

I know, I know, Thai rice is the best and people will pay anything to get it so we can dictate the price of this commodity...

It is interesting to me that none of the newspapers has actually done a very in depth explanation about how the rice pricing system works, we are just bombarded with 15,000 a ton, 500 USD at export, bla bla bla.

In a bit of reading over the last couple of days, it is the interaction between the various markets that is messing with the exports. Thailand has exported 3mn tonnes, but hom mali (the most expensive, makes up nearly 50% of the value, but 30% of the volume of all Thai exports in a normal season). So there is a huge discrepancy between the prices paid to farmers normally for Hom Mali in comparison with lower quality/grades of rice.

India has had a blockade on exporting low quality rice since 2007 until this year, but has always exported its higher quality rice basmati. So, this is I reckon as much politics as anything else. India was out of the low quality rice export business because it wanted to feed its people, and Thailand took a bet that it could force the prices of lower quality price up as well as hom mali. And then, whoops, India started exporting low quality rice as well, and the whole market has changed over night from where it was 18 months ago. If India hadn't entered the market and increaed supply, there would be a pretty good chance that prices for all traded rice would have firmed up, but alas no.

http://www.thairicee...or.th/price.htm

It would be wonderful if instead of talking in generic numbers for 15,000 a ton (500 USD), the breakdown of production and what is being bought was and exported by type was discussed because as you can see, the offered price for Hom mali as an example is 1000 USD per ton, (quite a nice margin I think we would all agree, but then digging deeper, it appears that the guaranteed price for hom mali is actually well above 15,000 a ton(maybe 20k per ton), but as far as I have read, represents about 30% of exports in a normal year. So the exporters will make good margins on the top stuff, but lose money on the lower quality stuff. The market is a lot more complex than a lose lose situation for all the market, everywhere. The hom mali exporters (mainly in Isaan) are getting paid a bit better, whilst the lower quality exporters/millers elsewhere are having a tough time of it. But reducing this to a "whole market is screwed" discussion doesn't appear to paint the whole picture. The newspapers are making no mention of what is in the mix of the 3mn tonnes of exported product, versus what is in the stockpile.

I can't find any specific stats anywhere to show the mix of the products exported so far, but from what I have read, the hom mali market is ok, it is the market for the lower value stuff that is the problem, because the supply offered to the market has increased with India now re-entering the export market.

http://www.worldbest...rtal/aboutus/33

Had to edit this, the spreadsheets from the websites won't layout properly on the page. If anyone else can bring some clarity to this crazy market, please do, because I can't help feeling that endless headlines describing baht prices on the average, when the exports are in dozens of grades in USD, isn't exactly showing the whole picture.

Edited July 27, 2012 by Thai at Heart