Foreign staff crisis threatens rice target

Foreign staff crisis threatens rice target

Exports delayed as port stocks back up

Labourers work in a rice warehouse in Ayutthaya province. SUNTHORN PONGPAO
Labourers work in a rice warehouse in Ayutthaya province. SUNTHORN PONGPAO

The crackdown on foreign workers may cause Thai rice exports to drop below the target of 10 million tonnes this year, with many migrants who work in the industry leaving the country.

According to Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, shipments of Thai rice to other countries have been hit hard by a workforce shortfall following the announcement of the royal decree on the management of employment of migrant workers.

"We're now drastically short of workers who handle discharging goods at the ports, leaving a number of shipments stranded at the ports, which is causing delays," he said. "The issue, if unaddressed, may eventually affect the country's rice shipments which are otherwise in a good condition."

There are usually 30,000-40,000 foreign workers employed in Thailand's rice industry at any one time.

Mr Chookiat said with a workforce shortfall, it is now taking about a month to discharge goods into the ships at the port, up from a previous average of seven to 10 days.

He said Thai rice exports are further at risk from foreign exchange volatility.

He said the baht strengthening will weaken Thai rice's competitiveness, citing every one-baht appreciation will raise the price of Thai white rice by US$8-9 per tonne.

Charoen Laothammatas, president of the Thai Rice Exporters Association, said the government's decision to invoke the powerful Section 44 of the interim charter to delay enforcement of the new controversial labour regulation law for 180 days will help address the labour issue only in the short term.

He called on the government to help facilitate the foreign workers' registration process, cut the registration fee and tackle other obstacles affecting Thailand's export competitiveness.

The foreign workers' registration fee is 30,000-40,000 baht per person.

The association said as of June 20 Thailand shipped 5.33 million tonnes of rice, up 15.6% from the same period last year, reclaiming its position as the world's leading rice exporter after losing this rank to India two years ago.

The association expects a combined 5.5 million tonnes were shipped in the first half this year and remains confident Thailand could ship 10 million tonnes this year thanks to growing demand from China, the Philippines, Indonesia, Iran, Iraq, Bangladesh and Sri Lanka.

Meanwhile, the Commerce Ministry has filed an appeal against an order by the Administrative Court demanding a suspension of auctions for 2.7 million tonnes of inedible rice.

Foreign Trade Department director-general Duangporn Rodphaya said the court's order may have a negative psychological impact on the rice trading industry.

"The department filed the appeal on Tuesday to explain details and steps of the previous 27 rice auctions that all complied with relevant laws and transparency," Ms Duangporn said.

The Administrative Court issued the order on June 30 for the department to suspend the auctions for 2.7 million tonnes of inedible rice stocks after TPK Ethanol Co filed a complaint with the court, saying the ministry unfairly banned the company from participating in the auctions in April this year.

According to the department's report, TPK Ethanol was disqualified because it had breached a contract with the department 20 years ago in the cassava price pledging scheme.

The case was concluded with the Supreme Court ordered the firm pay a fine to the department.

Because of its tainted history, the department would not allow the firm to join the rice bids.

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