A war room to be chaired by the commerce permanent secretary will be established to assess the impact of the El Niño weather phenomenon on Thai farm products, especially rice, along with preparing measures to mitigate the effects.
Speaking after a joint meeting with related agencies under the Commerce Ministry, including commercial counsellors in 58 offices in 42 countries, representatives from the Agriculture and Cooperatives Ministry, Finance Ministry, and the Digital Economy and Society Ministry, Commerce Minister Jurin Laksanawisit said the meeting agreed on the establishment of the war room.
The war room will be tasked with monitoring the El Niño situation, which poses drought risks globally. The war room will also track agricultural production, market conditions, rice prices, and other agricultural products.
Meanwhile, the 58 commercial counsellors stationed worldwide have been tasked with monitoring the drought situation, agricultural production, prices, and markets for all agricultural products, with a special focus on rice. They will report their findings to the Commerce Ministry every 1-2 weeks to keep tabs on the international situation.
Mr Jurin said the impact of El Niño and India's ban on rice exports from July 20 this year would affect the world's overall rice production, the rice market and prices.
He cited a report by the Royal Irrigation Department that said Thailand's rainfall is expected to decrease by 5% in 2023, compared to the 30-year average, and the water level in reservoirs is predicted to be about half of the previous year's volume, which would have an impact on crops in irrigation areas.
According to Mr Jurin, India's ban on white rice exports, which led to an increase in rice prices in the global market, has presented an opportunity to export rice to the African market, which previously relied on imports from India.
Thai farmers are expected to sell rice paddies at higher prices, especially white rice, which has seen a 7% increase in price since the ban. On the other hand, the cost of animal feed and livestock husbandry has risen, including the price of bagged rice, which may also be affected.
"I have ordered monitoring of rice prices to find a balance. While farmers benefit from higher paddy prices, we must also ensure that milled rice prices do not increase excessively to protect consumers. At the same time, entrepreneurs must also be able to survive. We aim for a win-win situation for all parties involved. If there are losses, they must be minimised for all parties. The war room's responsibility is to ensure an appropriate response," said Mr Jurin.
Regarding rice production, the Rice Department reported that in 2022 paddy rice production was 34.3 million tonnes, while this year's projection is around 32.3 million tonnes, a decrease of about 2 million tonnes, or 5.6%, due to the impact of the drought.
However, further evaluation is required to assess whether the drought situation will intensify and if there will be sufficient water resources for future cultivation. This assessment will be made during the August to September period to determine the extent of potential water resource shortages, he said.
Charoen Laothamatas, president of the Thai Rice Exporters Association, said 2023 appears to be a golden year for farmers because the newly-harvested paddies are currently priced at 12,000 baht per tonne, which is unprecedented and has never been seen before. Global rice prices, particularly for white rice, have risen by up to US$100 per tonne since India's export ban. However, the situation remains uncertain as it is unclear how India will proceed with the ban.
Despite India's ban, Mr Charoen said there was still demand from several countries for rice to ensure their food security.
