Rice Trade to slow until post-election

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RICE

Trade to slow until post-election
By Petchanet Pratruangkrai
The Nation 2011-05-07

Trade in Thai rice is expected to grow slowly in the next few months as Thai traders and international buyers wait to see the rice policy of the government that will be in place after the coming election.

Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said yesterday that foreign buyers had not been very active after political parties put forward different plans for rice trade under their farm-goods policies.

According to the association, the price of second-grade 100-per-cent Thai white rice has declined slightly from US$508 a tonne last week to $506 (Bt15,300) a tonne this week, while the price of 5-per-cent white rice was down from $491 to $489 a tonne. The price of jasmine rice dropped from $1,148 to $1,145 a tonne.

Also, the killing of al-Qaeda leader Osama bin Laden in Pakistan has influenced buyers' decisions, he said. Pakistan is a major rice exporter to the Middle East, but may decide to slow down its exports, or the Middle East may increase imports of rice from other countries to strengthen food security, Chookiat explained.

Pakistan exports about 3 million tonnes of rice a year, mainly to the Middle East.

Commerce Minister Porntiva Nakasai said the ministry was considering selling rice under government-to-government contracts. However, after Parliament has been dissolved, the ministry will ask Deputy Prime Minister Trairong Suwankhiri, as a vice chairman of the National Rice Policy Committee, whether he will allow the ministry to release the remaining of 1.5 million tonnes of rice from the government's stockpiles.

Meanwhile, Yanyong Phuangrach, permanent secretary of the Commerce Ministry, believes that the price of Thai rice is on the rise as Vietnam, the Kingdom's major export rival, has slowed down its rice exports for May and June.

He pointed out that the domestic price of rice had increased continuously from Bt7,900 last month to Bt8,200-Bt8,300 per tonne of paddy rice.

Although 4 million tonnes of rice is expected to enter the market during the second-crop harvest season, the rice price has increased gradually, Yanyong said.

To reduce the cost of production for farmers, the ministry will soon meet with fertiliser traders to urge sale of 100,000 tonnes of chemical fertiliser at Bt11,000 a tonne directly to rice farmers.