Thai Grain Prices Expected to Decrease
Published on: November 2, 2023.
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Rates for Thai Grains Expected to Soften
The price of Thai rice is expected to decrease in the final two months of the year as traders release the new harvest. However, despite lower prices, Thai rice will remain competitive due to a favorable exchange rate, according to the Thai Rice Exporters Association.
As of October 25th, the price of Thai 5% white rice was $586 per tonne, while Vietnam and Pakistan were priced at $643-647 and $563-567 per tonne, respectively.
The association had previously forecasted that rice exports would reach about 800,000 tonnes due to a significant backlog of rice commitments by exporters. Major importers, such as Indonesia, Malaysia, and markets in Africa, the Middle East, and the US, have been increasing their import of Thai rice to combat shortages in their countries and stabilize domestic rice prices.
In September, rice exports totaled 807,776 tonnes with a value of 17.2 billion baht, a 26.5% increase in quantity and a 48.1% rise in value compared to August. This increase was attributed to higher exports of parboiled and broken rice as importers scrambled to compensate for reduced stocks in their countries and secure reserves for year-end festivities.
The global rice market is expected to remain tight due to India’s export restrictions, which may last until the beginning of 2024. This may drive potential rice buyers to purchase more Thai rice.
In September, parboiled rice exports skyrocketed by 191% month-on-month to 236,120 tonnes, primarily to markets in South Africa, Benin, and Yemen.
White rice exports decreased by 7.5% to 349,709 tonnes, primarily shipped to markets in Indonesia, Malaysia, Iraq, Angola, Japan, Zimbabwe, and Mozambique.
Thai hom mali rice exports also decreased by 0.4% in September to 107,678 tonnes, mainly to key markets such as the US, Canada, Hong Kong, Singapore, and China.
Outlook and Projections
From January to September of this year, rice exports reached 6.08 million tonnes, valued at 118 billion baht (equivalent to $3.44 billion), a 12.3% increase in quantity and a 23.3% increase in value compared to the same period last year. This positive trend suggests that rice exports may surpass the Thai Rice Exporters Association’s target of 8.3-8.5 million tonnes for the year.
Demand for Thai rice remains strong, particularly from Indonesia. Additionally, Thai rice prices remain competitive compared to Vietnamese rice, which is about $50 more expensive per tonne.
Looking ahead, rice exports may decrease to 7.5 million tonnes as India begins to deliver rice from agreements with the Philippines, Indonesia, and Malaysia. These markets are crucial for Thai and Vietnamese exports, and the increase in India’s shipments may reduce Thailand’s export share. Indian rice is projected to be $50 to $60 per tonne cheaper than Thai rice.
Furthermore, Iraq, a significant buyer of Thai rice, may reduce its purchases from Thailand and increase imports from the US for political reasons.
Source: Bangkok Post
