Thailand's rice exports remain promising this half, but exporters worry that higher prices of hom mali fragrant rice may lure farmers to grow more of it, eventually weighing on prices.
Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said new purchase demands from the Philippines and Indonesia in particular are anticipated over the next several months.
Indonesia is estimated to seek 2 million tonnes in imports, while the Philippines is expected to demand 800,000-1 million tonnes. Potential key suppliers are Thailand and Vietnam, Mr Chookiat said.
"Higher domestic paddy prices have now attracted farmers to grow more rice," said the veteran rice trader. "Supply from the off-season is expected to amount to 12 million tonnes of paddy, outstripping the 8-million-tonne forecast by the Agriculture and Cooperatives Ministry, while the production of hom mali rice is also expected to exceed the earlier projection, thanks to enticing prices."
The ministry forecasts hom mali rice production at 7.2 million tonnes of paddy for 2018. But Mr Chookiat warned that massive stocks might affect hom mali rice prices.
Domestic paddy prices for hom mali have surged to a 10-year high, boosted by rising global demand and the government's depleted stocks. Hom mali paddy prices are now quoted at 15,000-18,000 baht a tonne, versus 9,500-11,600 a year ago. The price of white rice paddy has also risen from 7,300-8,000 baht a tonne to 7,500-8,200.
Mr Chookiat voiced confidence that Thailand's rice shipments would hit 10 million tonnes as forecast despite a slight drop in the first half.
According to the association's latest report, Thailand exported 5.32 million tonnes of rice, worth 85.8 billion baht, in the first six months. The volume fell 2% year-on-year from 5.43 million tonnes, while value rose 7% year-on-year from 80.2 billion baht.
Of the total shipments for the period, white rice accounted for 2.754 million tonnes, up 5.5% from the first half of 2017, followed by parboiled rice at 1.31 million tonnes, up 7.6%; hom mali rice at 848,109 tonnes, down 28.8%; glutinous rice at 214,190 tonnes, down 14.5%; and general aromatic rice at 192,841 tonnes, up 22.5%.
The top five buyers were Benin, Indonesia, China, South Africa and the Philippines.