Thailand regains top rank in world rice exports

Thailand regained the title of the world's top rice exporter, thanks a 45% jump in volumes, even as US officials cautioned of a potential slowdown in the releases from state inventories which have fuelled the surge.

Thailand had, as of May 20, shipped 3.93m tonnes of rice in 2014 overtaking India, with 3.74m tonnes, and Vietnam, with 2.4m tonnes, to become once more the top exporter of the grain, the Thai Rice Exporters Association said.

The jump in exports reflects a return to earth for Thai prices from elevated levels reached after the government in October 2011 began stockpiling the grain in a policy to support farmers' incomes, sending prices that month to $650 a tonne, for the benchmark grade of 5% broken rice.

Thai rice is now priced at about $390 a tonne, below the $400 a tonne being demand for Vietnamese supplies and $420-430 for Indian exports, the association said.

'May slow down'

The decline in prices has been driven by sales from state stockpiles, with officials since January having issued tenders from some 4m tonnes of rice.

However, the coup two weeks ago led by General Prayuth Chan-ocha, commander of the Royal Thai Army, means that "sales of rice stocks may slow down", the US Department of Agriculture's Bangkok office said.

Thailand's military government "will inspect government rice stocks nationwide before [making a] further decision on the sales of its rice stocks".

The country's coup actually appears to have had remarkably little effect on agricultural commodity prices, despite Thailand's status as the top rubber exporter and second-ranked sugar shipper, besides its pre-eminence in rice trading.

Export estimates

The USDA bureau also flagged a potential setback to 2014-15 Thai rice production, noting an estimate from official Thai meteorologists of a weak start to the rainy season.

May precipitation had fallen some 7-15% below normal in rice-growing areas, where rains this month were seen coming in 10% below average.

Nonetheless, despite potential production and bureaucratic question markets, the bureau stuck by an estimate of 9.0m tonnes for Thai rice exports in calendar 2014, a figure which the Thai Rice Exporters Association backed on Wednesday, raising its forecast from 7.5m tonnes.

The International Grains Council last week raised its forecast by 500,000 tonnes to 8.7m tonnes, highlighting "a large expansion" in Thai exports to Africa, which rose by 80% to some 1.2m tonnes in the January-to-March quarter.

"This included heavy sales to Nigeria, Cameroon, Ivory Coast and Togo, suggesting that Thai exporters have competed successfully with their Indian counterparts, the IGC said.

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