Drought fears overseas spur rice orders from Thailand

[webfact]

Drought fears overseas spur rice orders from Thailand
PETCHANET PRATRUANGKRAI
THE NATION, ASIA NEWS NEWORK

BANGKOK: -- ALARMED OVER the deteriorating drought situation, many countries have placed orders for Thai rice to secure sufficient stocks for consumption next year.

"The drought problem has started to raise concerns in many countries. Importing countries have considered purchasing more rice, mainly from Thailand, as they are worried about rising prices next year during the drought season," Commerce Minister Chatchai Sarikulya said yesterday.

Countries have contacted the Thai government about obtaining rice from its inventory for late this year and next year, he said.

Although Thailand also forecasts lower domestic yields next year, the government still has plenty of rice left in storage and can ship to many countries.

The US Department of Agriculture reported that many countries had started to face drought. The United States itself is reportedly suffering from its severest drought in 50 years.

Chatchai said that with increasing drought issues, the price of paddy rice in the local market had improved during the past week from about Bt8,000 a tonne to Bt8,500-Bt8,700.

To estimate the impact from the drought crisis, the ministry is cooperating with the Agriculture Ministry to survey and provide exact figures on rice production in the 2014-15 harvest season so that the government can prepare plans for rice exports and local consumption next year.

The Agricultural Ministry's preliminary estimate is about 22 million tonnes of paddy rice.

The Commerce Ministry will continue releasing rice from its stockpiles via many channels including government-to-government and government-to-business deals and general auctions.

The Foreign Trade Department will soon join the bidding to supply 500,000 tonnes of rice to the Philippines. The ministry is also negotiating to deliver rice to Malaysia and Indonesia, and will ship more rice to China under their G2G contract.

The ministry is targeting sales of 1 million more tonnes under G2G contracts this quarter.

Chatchai wants the ministry's Public Warehouse Organisation to adopt more technology in its work, particularly for inspection and preservation of rice stocks. This will prevent damage to warehoused rice and ensure transparency, he believes.

Thai trade offices overseas have been instructed to accelerate the drawing up of strategies and plans for promoting exports next year.

The ministry is scheduled to call a meeting with overseas Thai rice representatives and private enterprises from October 18-20.

Meanwhile , The United Nations Food and Agriculture Organisation has predicted that Vietnam's rice exports would increase by 6 per cent to 6.9 million tonnes this year.

The FAO attributed the increase to the country's rising paddy yield and the rising demand of Asian markets, including Indonesia, Malaysia, China and the Philippines.

The organisation estimated Vietnam's crop this year would hit a record high of 44.5 million tonnes, equivalent to 27.8 million tonnes of rice. That represents an increase of 740,000 tonnes from last year.

The FAO estimated paddy output during the summer-spring and autumn-winter harvest seasons would inch down against that of the same period last year, after the government's decision to use some rice-producing areas for the cultivation of other crops.

The Vietnamese Ministry of Agriculture and Rural Development reported that rice exports in the past nine months reached 5 million tonnes worth US$2.3 billion (Bt75 billion).

In September alone, the nation exported 524,000 tonnes of rice worth $249 million.

Wholesale rice prices in the domestic market increased for three straight months, including last month, because of rising import demand, especially from China.

A tonne of rice with 25-per-cent broken grain content was priced at $400, a 21-per-cent increase against that of September last year.

China remained the largest market for Vietnamese rice, at 33.2 per cent of exports, followed by the Philippines at 22.7 per cent, Malaysia at 6.1 per cent, Ghana at 5.4 per cent and Singapore at 3.3 per cent.

The US Department of Agriculture predicted that Vietnam's rice yield this year would reach 28 million tonnes, equivalent to 45 million tonnes of paddy, and that its exports would reach 6.7 million tonnes.

Source: http://www.nationmultimedia.com/business/Drought-fears-overseas-spur-rice-orders-from-Thail-30245044.html


-- The Nation 2014-10-09

[Mosha]

Erm, wasn't the PM asking them to plant 1 crop? The farmers hear this news, and you can kiss that idea goodbye.

[Robby nz]

Erm, wasn't the PM asking them to plant 1 crop? The farmers hear this news, and you can kiss that idea goodbye.

Because of a predicted lack of water, drought, not enough water to irrigate a second crop in some parts of the country, therefor the crop will not mature and any investment will be lost.

[kimamey]

Erm, wasn't the PM asking them to plant 1 crop? The farmers hear this news, and you can kiss that idea goodbye.

Because of a predicted lack of water, drought, not enough water to irrigate a second crop in some parts of the country, therefor the crop will not mature and any investment will be lost.

This seems fairly localised. Here in Mahasarakham we have high water levels and in a few places rice appears to be totally underwater. Our rice is fine and my wife says the water level is really high.

You never know for sure how much rain there will be or where it will be.

Although the rice scheme has ended the stored rice is still there so it will be interesting to see how much that sells for. There's also the new rice as well.

[ramrod711]

Now is not the time for caution! Now is the time to seize the day! Raise prices to above the world market price and capture the market, what could possibly go wrong?

[noitom]

Costco in the US has ceased to sell Thai rice in its Thai packaging on the 25 pound bags. TThey now pack and sell it in Costco's own label Kirkland that states that it's Thai jasmine hom mali rice. When asked about this , Costco managers said that they now order Thai rice in bulk and use their own packaging. It's a sign of de-emphasizing Thai rice and products and giving it much smaller shelf space allocation.

[ratcatcher]

Costco in the US has ceased to sell Thai rice in its Thai packaging on the 25 pound bags. TThey now pack and sell it in Costco's own label Kirkland that states that it's Thai jasmine hom mali rice. When asked about this , Costco managers said that they now order Thai rice in bulk and use their own packaging. It's a sign of de-emphasizing Thai rice and products and giving it much smaller shelf space allocation.

As he says..................

[rickirs]

"the government still has plenty of rice left in storage"

Now I wonder who put rice surplus in storage? Let's see if that rice will sell for more than what the government paid for it when new rice stocks suffer from drought. Ironcially, the Junta might hope it does sell for a higher price to more quickly to pay off the massive 7-10 year loan the Junta took out to pay off the rice farmers.

[Don Aleman]

Orders will probably cease as soon as the first bag is opened !

[recycled]

Sorry Thailand, you will sell squat. No credibility equals no sales.

[taony]

Hope buyers get a money back guarantee - for when they open a bag of rotting rice.

[ramrod711]

"the government still has plenty of rice left in storage"

Now I wonder who put rice surplus in storage? Let's see if that rice will sell for more than what the government paid for it when new rice stocks suffer from drought. Ironcially, the Junta might hope it does sell for a higher price to more quickly to pay off the massive 7-10 year loan the Junta took out to pay off the rice farmers.

I certainly don't want to put words in your mouth, so i'll make this post a question. Are you suggesting that the Junta should have maintained the Shinawatra/ PTP policy of Not paying the farmers? Weren't PTP trying to obtain loans to pay the farmers, but their credibility was nil? Are you suggesting that the rice debacle was a success? I'm so confused, you consider a massive failure to be a success, oh well, no sense wasting any more time on this.

[PoorSucker]

Fight over water between two groups of farmers in Ayutthaya

http://www.thaivisa.com/forum/topic/766997-fight-over-water-between-two-groups-of-farmers-in-ayutthaya/

[wackybacky]

"the government still has plenty of rice left in storage"

Now I wonder who put rice surplus in storage? Let's see if that rice will sell for more than what the government paid for it when new rice stocks suffer from drought. Ironcially, the Junta might hope it does sell for a higher price to more quickly to pay off the massive 7-10 year loan the Junta took out to pay off the rice farmers.

Obviously the world rice importers are quite happy to pay high prices for rice that is 80% degraded.... NOT methinks. They will insist on new crop rice, and old stock rice at a push, but at very low prices.

At the end of the day, rice importers will not want to risk their reputation for pushing very sub-standard grain onto their 'valued' customers. They have their entire future and credibility to think of, not just for the following year.

They will just chase the best rice out there regardless of the cost, because the cost is quite simply passed on to the customer as usual.

As a matter of fact, rice importers make lots more money from a rapid price increase than a price slump. because they work off a % margin, and when the price rises they charge appropriately, then when the price comes back down, they rarely drop it back all the way.

I am an importer (of other commodities) so I know what I am talking about.

[belg]

long live the drought, saviour of the thai rotten rice stockpiles

[Thai at Heart]

"the government still has plenty of rice left in storage"

Now I wonder who put rice surplus in storage? Let's see if that rice will sell for more than what the government paid for it when new rice stocks suffer from drought. Ironcially, the Junta might hope it does sell for a higher price to more quickly to pay off the massive 7-10 year loan the Junta took out to pay off the rice farmers.

I certainly don't want to put words in your mouth, so i'll make this post a question. Are you suggesting that the Junta should have maintained the Shinawatra/ PTP policy of Not paying the farmers? Weren't PTP trying to obtain loans to pay the farmers, but their credibility was nil? Are you suggesting that the rice debacle was a success? I'm so confused, you consider a massive failure to be a success, oh well, no sense wasting any more time on this.

They got prevented from setting up the loans because the election happened.