Prices of agricultural goods surging due to war, govt schemes, disease: BAAC
The Russia-Ukraine war and government subsidies are pushing up the price of agricultural products like paddy rice, raw sugar, tapioca, palm oil and maize, the Bank for Agriculture and Agricultural Cooperatives (BAAC) has said.
BAAC vice president Somkiat Kimawaha recently said the bank’s research and innovation development team has predicted that the ongoing war, government subsidies and the Covid-19 crisis will further push up the price of several agricultural products in March.
According to him, the following crops will see a jump in price:
• Jasmine paddy rice: The price now stands at between 11,503 and 11,850 baht per tonne, marking an increase of about 0.5 to 3.54 per cent. This increase was attributed to a scheme in which rice farmers were granted loans to delay the sale of their harvest until prices rose.
• Raw sugar in the New York Stock Exchange: Raw sugar is being traded in New York at between $0.1865 and $.1880 per pound, marking an increase of 0.65 to 1.45 per cent. This increase was attributed to the ongoing war, which has affected the oil demand. In Thailand, rising global oil prices have led to a higher demand for ethanol, so more sugarcane is being used to make fuel instead of sugar.
• Maize: Its price stands at between 8.99 and 9.02 baht per kilogram, marking a rise of 0.11 to 0.45 per cent. The increase was attributed to the war as it has affected the export of wheat from Ukraine. With the price of wheat surging, manufacturers are now using maize for animal feed.
• Tapioca: Tapioca now trades for between 2.33 and 2.37 baht per kilo, marking an increase of between 0.88 and 2.63 per cent. This is because the demand for tapioca in China is still high as it is used as a key ingredient for making ethanol.
• Oil palm: Oil palm is being traded at 8.58 to 9.02 baht per kg, marking a rise of 3.12 to 8.41 per cent. This increase has been attributed to expanding economies and rising oil prices due to the war, which is prompting many countries to start using oil palm to make bio-diesel.
• Third-grade rubber sheets: These are now being traded at about 56.27 to 57.45 baht per kg, recording an increase of about 0.18 to 2.28 per cent. This increase has been attributed to a drop in supply because the milking of rubber trees in the Northeast and East has stopped due to the off-season. Also, rubber plantations in Indonesia and Vietnam have been hit by a new disease.
• Pork: The meat is now trading at about 95.91 to 96.89 baht per kilo, marking a rise of between 0.13 to 1.15 per cent. The price of pork is surging because the cost of raising pigs has risen by 14 per cent due to expensive pig feed. In addition, pig farmers have also had to shoulder the cost of preventing the spread of African Swine Fever.
