USDA GAIN: Thailand Weekly Rice Price Update

USDA GAIN: Oilseeds, Cotton, Sugar, Grain and Feed

Reports » USDA GAIN: Oilseeds, Cotton, Sugar, Grain and Feed » USDA GAIN: Thailand Weekly Rice Price Update

27 January 2012

Domestic and export prices further declined 2-4 percent from the previous week due to lack of enquiries.

Report Highlights:

Millers are alarmed over the sluggish foreign demand as they are holding large stocks of parboiled and white rice. Presently, the difference between Thai rice prices and Indian and Vietnamese rice prices has gradually narrowed to around $80/MT.

Domestic and export prices further declined 2-4 percent from the previous week due to lack of enquiries. Millers are alarmed over the sluggish foreign demand as they are holding large stocks of parboiled and white rice, as a result from their speculative activities believing that the aggressive Paddy Mortgage Program would result in escalating world prices. In fact, domestic prices are higher than global prices and there is no demand for Thai rice. Presently, the difference between Thai rice prices and Indian and Vietnamese rice prices has gradually narrowed to around $80/MT, compared to a $100-170/MT difference in the past two months. As such, foreign buyers continue to purchase Indian and Vietnamese rice. This has prompted exporters to voice their concerns and have asked the Government to review its aggressive intervention program, if let unchanged it will likely result in a sharp reduction in rice exports to 7.0 million tons in 2012, as compared to 10.5 million tons in 2011. Moreover, in the worst case scenario, exports will likely decline to 6.5 million tons if India does not limit its non-basmati rice exports at 2.0 million tons.

Presently, the Government is holding old-crop intervention stocks of around 2.0 million tons. Meanwhile, the current Paddy Pledging Program has accepted a total of 5.3 million tons of paddy (3.5 million tons milled equivalent) from October 7, 2011 - January 15, 2012 (Table 2). This accounts for 23.5 percent of the expected total MY2011/12 main-crop production of 21-22 million tons of paddy (14.5 million tons milled equivalent). The Government expects the program will finally absorb only 7.0 million tons of paddy (4.6 million tons milled equivalent), by the end of the program in February 29, 2012, far below its initial target of 10.0 million tons of paddy.

Rice Export Update

Unofficial rice exports (excluding fragrant rice) for January 9-15, 2012 totaled 104,079 tons, up 42,769 ton from the previous week. Exports of white rice and parboiled rice during January 1 - 15, 2012 totaled 116,489 tons, down 56.3 percent from 380,655 tons in the previous year.

According to the Department of Foreign trade, Ministry of Commerce, total rice exports (including fragrant rice) during January 1 - December 29, 2011 amounted to 10,518,891 tons, up 17.1 percent from 8,983,788 tons in the previous year.

USDA GAIN: Oilseeds, Cotton, Sugar, Grain and Feed