China's cheap rice threatens Thai exports

China's cheap rice threatens Thai exports

Thai rice faces competition from China as the East Asian country plans to ramp up its rice shipments to other markets. (Photo by Pattanapong Hirunard)
Thai rice faces competition from China as the East Asian country plans to ramp up its rice shipments to other markets. (Photo by Pattanapong Hirunard)

Thai rice exporters are fretting over their prospects this year as China looks set to ramp up its rice shipments, notably to Africa.

China produces an estimated 120 million tonnes of rice each year and is likely to raise exports to 3 million tonnes of aged grains this year from 1.5-2 million tonnes last year, said Chookiat Ophaswongse, honorary president of Thai Rice Exporters Association.

Africa is a potential target market for China now that consumers there are in the habit of eating aged rice, he said.

China’s 5% white rice is quoted at US$300 (9,370 baht) a tonne, while similar grains from Thailand are quoted at $390, those from Vietnam at $360 and those from India at $370.

“Chinese rice is very cheap compared with others,” Mr Chookiat said. “More importantly, Thailand has run out of stocks of aged rice.”

Thai rice shipments totalled 11.09 million tonnes last year, down 5% from 11.67 million in 2017 but greater than 2016's 9.91 million.

The value of rice exports rose 8.3% last year to $5.61 billion from $5.18 billion in 2017 and $4.40 billion in 2016. Rice export prices averaged $507 per metric tonne last year, up 14.1% from 2017.

White rice accounted for 5.49 million tonnes (up 17.4% year-on-year), including parboiled rice (2.71 million tonnes, down 19.9%), hom mali fragrant rice (1.27 million tonnes, down 22.1%), white broken rice (390,000 tonnes, down 0.7%), hom mali broken rice (380,000 tonnes, down 43.2%), general fragrant rice (260,000 tonnes, up 18.6%), broken glutinous rice (200,000 tonnes, down 32.3%) and glutinous rice (180,000 tonnes, down 15.7%).

For the whole of 2019, rice exporters forecast Thai shipments of 9.5 million tonnes, or 500,000 tonnes shy of the Commerce Ministry’s projection.

According to Mr Chookiat, China has continued to develop rice varieties with higher yields, meaning the country could expand its rice exports to other Asian countries in the future at relatively low prices.

“As long as China is capable of exporting its grains to Asia, especially to Hong Kong, Indonesia, Malaysia and the Philippines, Thailand’s rice market will be hit the hardest,” Mr Chookiat said.

He said the new government should promote development of new rice varieties and support more R&D to add value to Thai rice and reduce production costs for farmers.


Do you like the content of this article?
COMMENT (24)

Russia detains US reporter for ‘spying’

MOSCOW: An American journalist working for the Wall Street Journal has been arrested in Russia on charges of spying for Washington, Russia’s FSB security services said on Thursday.

17:21

Anger in Indonesia as Fifa pulls U-20 World Cup

JAKARTA: Indonesian football players, fans and pundits reacted with anger and sadness Thursday after Fifa pulled the Under-20 World Cup from the host nation weeks before it was due to kick off, following protests against Israel's participation.

14:45

Gambling raids

Police raided 17 locations, including a luxury home belonging to a Thai actress' husband, with suspected links to online gambling networks.

13:51