Focus on Thailand

by Chris Lyddon
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Asian country is one of the world’s biggest producers and exporters of rice.
Thailand is one of the world’s most important producers and exporters of rice, and rice is important in the diet of the average person in Thailand as well as to the country’s economy. The country imports all its wheat needs.

According to the International Grains Council (IGC), Thailand will produce 5 million tonnes of grains in 2017-18, down from 5.3 million the previous year. The total includes 4.9 million tonnes of maize, down from 5.2 million the previous year. The IGC also forecasts that Thailand will produce an unchanged 100,000 tonnes of sorghum.

The IGC forecasts that Thailand will import 4 million tonnes of grains in 2017-2018, a figure unchanged from the previous year. Imports of wheat are put at 3.4 million tonnes in 2017-18, down from 3.6 million the previous year.

In rice, Thailand is one of the world’s most important producers and exporters. The IGC forecasts its output in 2017-18 at 19.3 million tonnes, up from 18.5 million the year before. Its projected exports are an unchanged 10.3 million tonnes.

The attaché’s annual report explained that the recovery in rice production is expected because “reservoirs are well above critically low levels that hindered 2016-17 rice production.”

“The government is likely to sell all of the remaining 2.9 million tonnes of food-quality rice stocks in 2017, which will help maintain Thai rice export volumes,” the report said. “The sale of non-food quality government rice stocks is anticipated to increase the use of broken rice by the feed and ethanol industries in 2017 and 2018. Government stocks are expected to decline to 1 million to 2 million tonnes by the end of market year 2017-18.”

In Thailand, water supplies for both irrigated and non-irrigated growing areas show a considerable improvement on a year earlier, enabling 2017-18 main crop seeding to advance quickly, the IGC said.

“Together with the relatively small secondary (off-season) outturn, planting of which typically commences in November, the area for harvesting is seen expanding by 4% y/y and, on the basis of trend productivity, output is projected to stage a further recovery, to 19.3 million tonnes (18.5 million last year).”

The government sell-off of reserves would bring down stocks.

“In Thailand, where the government continues to dispose of old crop reserves, inventories are projected at a 10-year low,” the IGC said. “Due to ongoing sales of states reserves, Thailand’s end-season stocks are predicted to fall to a six-year low of 6 million tonnes (8.1 million last year). On the supply side, the Thai government sold almost 1.7 million tonnes of old crop reserves in its latest auction, although supplies are yet to be released to exporters.”

Thailand’s rice exports between January 2017 and April 2017 totaled 3.6 million tonnes, according to the IGC, a figure that is up slightly on the year and the highest since 2011.

“Data show that deliveries to sub-Saharan Africa expanded by one-fifth, to a nine-year peak of 1.8 million tonnes, including substantially larger dispatches to Angola, Benin (mainly for transshipment to Nigeria), Senegal and South Africa,” the IGC said, as part of an analysis of that part of Africa’s rice imports. “While the region’s buyers have imported more parboiled supplies, rising by 30%, to 640,000 tonnes, the overall increase was also underpinned by larger purchases of white and broken rice.

“World market availabilities were boosted by the Thai government’s stock releases and, with offer prices likely pegged at big discounts to open market values, sizeable amounts of low-quality rice have been shipped to Africa.”