Thailand has reclaimed its position as the world’s number one rice exporter despite of its political turmoil. It lost that title two years ago after holding it for three decades. New figures show Thailand has regained the crown but at a cost.
Rice is big business in Thailand – and is at the center of its political woes. For almost 30 years, Thailand was the world’s number one exporter. But two years ago it lost the title.
An over-generous subsidy for farmers saw the price soar on world markets to around 590 US dollars a tonne. Countries stopped buying Thai rice. It fell to third in the export league.
In Thailand itself the scheme caused a political backlash, and was a major cause of turmoil.
But new figures reveal Thailand has returned to the top exporter spot. In the first five months of this year, Thailand exported an estimated 3.9 million tonnes of rice - ahead of India at 3.7 million tonnes and Vietnam at 2.4 million tonnes.
But to do so it’s had to drastically reduce the price – down 30 per cent to just 390 dollars a tonne. Selling at a huge loss to get the crop moving.
Sales have been boosted by rising demand from China, and poor crops in many countries. But Thailand still has a huge stockpile of rice to sell, estimated at between 10 and 17 million tonnes.
The rice industry now wants a detailed inventory of stocks to be carried out to determine the exact size of the stockpile, and the condition of the rice – some of which has now been in storage for up to two years.
Thailand now hopes to export 9 million tonnes of rice in 2014 with a value of 4.8 billion dollars - 20 per cent more than the previous best estimate. And with the end of the subsidy scheme, world demand will once again dictate price – both to the farmer, and the market place.