Price of Thai rice reaches 17-year high
Rice exports from January to October 2023 increased by 11.4% to 6,922,649 tons with a total value of 136,289.8 million baht, a surge of 24.6% compared to the same period last year.
These figures signify a positive trend in Thai rice exports, prominently influencing paddy rice prices, said Pramote Chareonsilp, president of the Thai Agriculturist Association, adding that in the past week, various Thai rice types have seen a price increase. Previously ranging from 8,000 to 9,500 baht per ton, they have now peaked at 12,000 baht per ton, the highest in 17 years.
Enquiries with rice mills reveal that this increase is linked to the current elevated price of Vietnamese rice, approximately $70-90 higher per ton than Thai rice due to insufficient production in Vietnam. India’s export restrictions on rice, coupled with measures to stabilise Thailand’s paddy rice prices through cooperative purchases above market rates, also contributed to the overall rise in Thai paddy rice prices.
Rice mills actively procure rice from farmers for pre-ordered exports, anticipating a continued upward trend in Thai rice prices. With over 70% of the harvest collected, particularly white rice in the central region, farmers storing dry rice are expected to benefit from increased prices, Pramote said.
While the rise in rice prices is likely to encourage farmers to invest in a second crop, Pramote warned that potential water-related risks must be carefully considered.
A report from the Office of Agricultural Economics (OAE) reveals that from July to November 2023, 22.938 million tons of paddy rice, representing 89.71% of the main crop production, entered the market. An estimated 2.631 million tons, constituting 10.29% of the main crop production, are expected to follow.
Pol. Lt. Charoen Laothamatas, president of the Thai Rice Exporters Association, highlighted the significant fluctuations in current rice export prices, noting that these are affected by changes in Thailand’s exchange rates, making it challenging to quote sales prices. Over the past two weeks, rice prices initially surged, then declined considerably before adjusting again upwards in the past week.
As production increases, rice prices may soften, contingent on external factors. Vietnamese rice prices remain notably lower than Thai prices, potentially impacting the market if Vietnam exports a substantial quantity at competitive prices.
Charoen stressed the need for caution in terms of both quantity and timing of exports due to exchange rate fluctuations
“Quoting prices for a single day based on a slightly inaccurate currency forecast could result in losses,” he warned."
