Floods ravaging vast plots of farmland in many areas nationwide are likely to delay by two weeks harvesting of the main crop of the country's 2022-23 season, limiting output for the season which usually gets underway in early November.
A farmer in Nakhon Ratchasima province tries to salvage his rice after it was submerged in flood waters during the floods in October 2020. (Photo: Prasit Tangprasert)
According to Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, floods resulting from Typhoon Noru in late September and heavy rains during the early part of this month may reduce the country's main rice crop, but it is too early to estimate the value of damage because flooding continues in many parts of the country.
"Rice plots in the hills may be not affected much, but the lowlands face a definite impact because they are still inundated. We'll have to wait until the harvest to see how many grains have broken," he said.
Mr Chookiat said many importers have inquired about the flooding situation, as they are afraid of rising rice prices if Thai production sees a lot of damage.
Rice production for the country's 2022-23 crop was originally estimated at 26.9 million tonnes of paddy rice, up 2.09% from the previous season.
Kasikorn Research Center estimates that flooding during August and October may cause around 2.9-3.1 billion baht's worth of damage to rice in the country's main crop and possibly drive Thai rice prices to stay at relatively high rates during this period.
Mr Chookiat said if the floods continue, bringing about collateral damage to the country's overall rice production, a negative impact may arise for Thai exports in the year to come.
However, he insisted that the floods are unlikely to cause a significant impact on Thai rice exports this year.
"This year, Thailand's rice exports will definitely reach 7.5 million tonnes and can reach 8 million, too, due to the weak baht and India's export tax increase. More importantly, Thailand has enough rice stockpile to export to the world market," said Mr Chookiat.
In September, India, the world's largest rice exporter, banned overseas sales of broken rice and levied a 20% duty on exports of various rice grades.
Mr Chookiat said Thailand's domestic rice prices are considered to be good and will remain at a relatively high level this year driven by strong export demand and baht weakness which raise the country's competitiveness in terms of rice exports.
The price of domestic white paddy is now quoted at 9,500-10,000 baht per tonne, while the price of Thai hom mali paddy stands at 14,500-15,000 baht per tonne.
The free-on-board price of Thai white rice 5% is now quoted at US$439 per tonne, while Vietnam's white rice stands at $428-432 per tonne.
"We expect Vietnam can ship a maximum of 7 million tonnes because the country needs enough to feed its population of 100 million, while Thailand has enough rice for exports of 8-9 million tonnes a year," he said.
In the first nine months, Thailand's rice export volumes stood at 5.6 million tonnes, up 44% from the same period of last year. Despite heavy rains in the country, Thai rice exports could reach over 800,000 tonnes in September.