Thailand
Thailand: Strong baht to depress 2018 exports
Thailand’s rice exports are expected to ease this year from an expected record high of 11.2-11.3 million tonnes in 2017 because of rising global demand and the competitiveness of the local grain, says the Thai Rice Exporters Association.
President Charoen Laothammatas said the association forecast Thailand’s rice exports to dip to 9.5 million tonnes this year because of depleted state rice stocks and lower Thai hom mali fragrant rice output because of heavy rains in many areas.
The Agriculture Ministry projects rice production for the 2018 season at 30 million tonnes of paddy rice or 22-23 million tonnes of milled rice, equivalent to last season.
But the association argued such production is uncertain, citing weather volatility, while domestic consumption is estimated to exceed 10 million tonnes of milled rice this year because of rising tourist arrivals and foreign workers in Thailand.
The biggest risk factor for rice exports this year is baht appreciation that will whittle down Thailand’s competitive edge, said Mr Charoen.
The strong baht will hurt Thai hom mali rice the most because supply is generally limited, making the premium grain more expensive than similar rice from other countries, he said.
As of Dec 27, 2017, Thai hom mali rice was quoted at US$993 a tonne, while aromatic rice from Vietnam was quoted at $600 a tonne and Cambodian aromatic rice sold for $800.
Based on the sharp baht appreciation, Thai hom mali rice is now quoted at about $1,000 per tonne.
Mr Charoen is confident Thailand shipped 11.2-11.3 million tonnes last year, setting a record high for rice exports. The volume was up from 9.90 million tonnes in 2016.
According to the association’s figures, Thailand shipped a total of 10.5 million tonnes in the first 11 months of last year, up 19.9% from the same period a year earlier.
Values also rose 14.1% for the period to 156.6 billion baht.
The top five importers of Thai rice were Benin, China, South Africa, Cameroon and the US.
The association estimated Thailand would ship about 800,000 tonnes in the final month of 2017, raising the total for the full year to 11.2-11.3 million tonnes.
Source: https://www.bangkokpost.com/business/news/1390438/strong-baht-to-depress-2018-exports