High demand for rice sends prices soaring

[webfact]

High demand for rice sends prices soaring

 

BANGKOK, 22 May 2017 (NNT) - Rice exporters are saying the crop’s price drop has ended and believe high demand and releases from state stocks will send values climbing by up to 20 percent. 

President of the Thai Rice Millers Association Kriangsak Tapananont has revealed foreign orders for rice have jumped with most also urgent due to high global demand. The hike has sent domestic rice prices soaring even as the government puts its millions of tons of rice to auction and the baht remains strong, two factors that usually depress rice values. Un-milled rice has climbed 15 percent over the last 2-3 weeks from 7,600 baht a ton to 8,200 baht. 

Kriangsak remarked that the rice industry has likely passed its lowest point while believing that flooding in some areas of the nation will not impact stocks. The Ministry of Agriculture and Cooperatives is predicting the nation will produce up to 30 million tons of rice this year. 

President of the Thai Rice Exporters Association Charoen Laothammatas gave a similar assessment, pointing out rice prices are up 20-30 percent depending on strain. He highlighted an order of almost 100,000 tons from Iran alone and the prospect of the Philippines purchasing no less than 250,000 tons soon. Exporters are also geared up to take part in a bid to sell up to 50,000 tons of rice to Bangladesh.

 

-- nnt 2017-05-22

[jerojero]

20% jump in prices? From a possible increase in demand. Just like that? 20%. Doubt it. Is the 400 000 tons new export volume this year? If so, it's at a loss from other rice exporting countries, thus they will put downward pressure on world prices.

 

 

 

 

 

 

[USPatriot]

And the farmers got nothing.

[mtls2005]

Un-milled rice has climbed 15 percent over the last 2-3 weeks from 7,600 baht a ton to 8,200 baht. 

 

I confess to not understanding the growing/production (milling)/distribution cycles & processes here but is he quoting some sort of current price which millers are paying farmers? Or is this a sort of 'intra-country' futures price?

 

Didn't they just have the Royal Ploughing ceremony (with a good harvest predicted by the Royal Oxen) kicking off the beginning of the 'season' with planting occurring now? Wouldn't that mean that un-milled supplies are at a low (and price high?)? Or do they store un-milled rice?

[robblok]

2 minutes ago, mtls2005 said:

Un-milled rice has climbed 15 percent over the last 2-3 weeks from 7,600 baht a ton to 8,200 baht. 

 

I confess to not understanding the growing/production (milling)/distribution cycles & processes here but is he quoting some sort of current price which millers are paying farmers? Or is this a sort of 'intra-country' futures price?

 

Didn't they just have the Royal Ploughing ceremony (with a good harvest predicted by the Royal Oxen) kicking off the beginning of the 'season' with planting occurring now? Wouldn't that mean that un-milled supplies are at a low (and price high?)? Or do they store un-milled rice?

Un milled rice.. is probably the price they pay farmers. So this is the price they are offering the farmers.. I wonder how much the price the millers get has increased.  This is a future price.. I take it the sales for rice are also future sales. 

[halloween]

Is "B7600 to B8200" the current price range? Because it sure isn't a 15% increase. 15% of 7600 is 1140.

[thaiguzzi]

Prices soaring.

yeah, for the end seller then the consumer. Rice mill middlemen...

Meanwhile the peasant farmers are getting zilch in relation to "prices soaring". I hear that prices are terrible at the moment if you are selling to a rice mill.

[edwinchester]

1 hour ago, halloween said:

Is "B7600 to B8200" the current price range? Because it sure isn't a 15% increase. 15% of 7600 is 1140.

Thai 15% is different.

[maxisrael]

1 hour ago, thaiguzzi said:

Prices soaring.

yeah, for the end seller then the consumer. Rice mill middlemen...

Meanwhile the peasant farmers are getting zilch in relation to "prices soaring". I hear that prices are terrible at the moment if you are selling to a rice mill.

The farmers around here get average 6.500 baht /ton.

[SOUTHERNSTAR]

9 hours ago, robblok said:

Un milled rice.. is probably the price they pay farmers. So this is the price they are offering the farmers.. I wonder how much the price the millers get has increased.  This is a future price.. I take it the sales for rice are also future sales. 

The rice that is sold at these prices are mostly from the previous season and for which the farmers got the old lower price. The increase in the international price is only benefitting millers and the government, not the farmers. The article is also unclear about the prices as there is a price difference between Thai white rice and jasmine rice and between grades of rice. The increases mentioned in this article is thus an average of averages which says nothing. Thailands rice is not sold at future prices but is sold at auctions. The problem is that when the real production kicks in the prices could fall again. At best this is a feel good article. 

[robblok]

19 minutes ago, SOUTHERNSTAR said:

The rice that is sold at these prices are mostly from the previous season and for which the farmers got the old lower price. The increase in the international price is only benefitting millers and the government, not the farmers. The article is also unclear about the prices as there is a price difference between Thai white rice and jasmine rice and between grades of rice. The increases mentioned in this article is thus an average of averages which says nothing. Thailands rice is not sold at future prices but is sold at auctions. The problem is that when the real production kicks in the prices could fall again. At best this is a feel good article. 

Thanks, that is something I did not know.. so there are no future contracts here. So this means the miller always takes a risk.. and sometimes gets rewarded for it. I guess they then try to make a decent margin because they take the risk ?.

 

Not that i condone it if they are really profiteering from the farmers hard work. 

[Srikcir]

14 hours ago, webfact said:

He highlighted an order of almost 100,000 tons from Iran alone and the prospect of the Philippines purchasing no less than 250,000 tons soon. Exporters are also geared up to take part in a bid to sell up to 50,000 tons of rice to Bangladesh.

Normal sales that have nothing to do with the prediction of rising rice prices.

Given India's massive rice production, any potential rise in rice due to demand will likely be offset by more of India's rice put into the marketplace.

[fruitman]

16 hours ago, USPatriot said:

And the farmers got nothing.

Because they were so smart to sell rice via new networks, no more middleman.

 

They got a good price by the way.

 

 

[Chris Lawrence]

Mrs T still has a stock pile of rice? Lucky she saved for rainy day.

 

So what does the farmer make?

[Chris Lawrence]

If you view the page below, April 2012 the price per metric ton was $581.77US compared to April 2017 being $374.50US. Rice in the last 5 years has taken a hammering.

 

http://www.indexmundi.com/commodities/?commodity=rice&months=60