India’s Rice Export Ban Sparks Optimism for Thai Prices
Published on: January 16, 2024.
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Optimism for Thai Rice Prices as India’s White Rice Exports Remain Banned
The ongoing ban on white rice exports in India is bolstering the optimism of local shippers in Thailand. Chookiat Ophaswongse, Honorary President of the Thai Rice Exporters Association, predicts that Thai rice prices will remain relatively high during the first half of this year. He believes that global market prices will stay around US$600 per tonne, a rate not seen in over a decade, due to strong demand from numerous countries.
Last year, rice exports from Thailand likely exceeded earlier projections, reaching a total of 8.8-8.9 million tonnes. This increase in exports was attributed to higher prices, which led to an estimated value of 180 billion baht (US$5 billion). In November 2022 alone, exports scaled up to one million tonnes, valued at 23 billion baht (US$658 million). This marked a significant increase compared to October 2022.
Continuation of Rice Imports by Indonesia
Chookiat also foresees a continuation of rice imports by Indonesia this year, although the quantity may be lower than last year. In 2023, Indonesia imported nearly four million tonnes of rice from several nations, including Thailand, Vietnam, Pakistan, and Myanmar.
Strong Demand from Key Importers
The Thai Rice Exporters Association predicts that last month’s rice export volume was around 900,000 tonnes. This is due to exporters’ commitment to deliver a substantial quantity of rice this month, coupled with significant demand from key importers in Asia such as Indonesia, Malaysia, the Philippines, and Japan.
Thailand’s Competitive Advantage
Thailand’s rice supply remains sufficient and the price of Thai rice remains competitive, according to Chookiat. This leads importers to choose the local grain over rice from other countries. As of December 27 last year, the price of Thai white rice 5% was quoted at US$659 per tonne. In comparison, prices from Vietnam and Pakistan were in the range of US$653-657 and US$593-597 per tonne, respectively.
Looking ahead, the association anticipates Thailand shipping around 7.5 million tonnes of rice this year. The potential impact of the El Niño weather phenomenon on global rice production will also be closely monitored.
Importance of Rice Exports for Thailand
The latest data from the Customs Department reveals that for the first 11 months of 2023, Thailand exported 7.95 million tonnes of rice valued at 160 billion baht (US$4.61 billion). This marks a 14.7% increase in volume and a 28.9% increase in value year-on-year. Rice exports play a crucial role in Thailand’s economy.
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