Minister expresses concern about the effects of drought
Published on: October 13, 2023.
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Fear of Drought Impact on Rice Production
The dry period caused by the El Niño weather phenomenon is causing concerns for Commerce Minister, Phumtham Wechayachai, who warns its impacts could persist for up to three years.
This prolonged impact could potentially reduce rice production and lead to a domestic scarcity, warns Minister Phumtham.
Preventing the Impact
On Wednesday, Minister Phumtham urged the Internal Trade Department and Foreign Trade Department to collaborate. Their task? To monitor and soften the effects of this drought and the associated El Niño phenomenon should it continue for up to three years. He emphasized the potential negative impact on the growth of crucial agricultural products such as rice, cassava, maize, and oil palm which might result in a global supply reduction due to the drought affecting many countries.
While many countries are keen to purchase these products from Thailand, Mr Phumtham cautions that rapidly accelerating exports could result in domestic shortages. Achieving a balance between maintaining adequate domestic stock and managing export activities to avoid affecting domestic product prices is crucial, he said.
Contrary to some concerns, the Commerce Ministry will not be implementing export bans or restrictions on agricultural products in response to increasing demand. This is despite the mounting apprehension over the severe implications of the El Niño weather phenomenon.
Predicted Impact on Rice Exporters
Rice exporters are advised to focus not just on the potential fluctuation of prices, but also to ensure sufficient domestic supply of agricultural products. The quantity of rice present in the country should also be monitored in order to avoid hiked Pakistani rice prices rather than banking solely on increased prices.
This concern should be communicated to relevant agencies and associations, suggests Minister Phumtham.
Optimism Despite Predicted Drought
In contrast, Chookiat Ophaswongse, the Honorary President of the Thai Rice Exporters Association, posits that this year’s rice production, including white broken rice, will be less affected by El Niño than previously thought. Ongoing rainfall is expected to support existing projections.
Looking at next year, he mentions a report by the US Department of Agriculture predicting a global increase in rice production from 518 million to 523 million tonnes. India and China’s output is expected to remain stable.
Pakistan’s production is set to see an increase whereas Thailand and Vietnam are predicted to maintain their current production levels. Provided there is no severe drought, Thailand’s production is projected at 20 million tonnes of milled rice, effectively preventing any rice shortages.
Even though some projections suggest the El Niño effect could persist for another two years, the current year’s impact has been relatively manageable. Next year’s condition is also expected to be milder.
Looking Into the Future
In line with the predictions, rice exporters in Pakistan anticipate Thailand will ship 8-8.2 million tonnes of rice this year. The estimated exports for 2024 are likely to be 7-7.5 million tonnes. The competition in the global rice market is expected to be fierce, with basmati rice Pakistan among the top products.
