Thai Rice Exporters Association (TREA) claimed that even after the devastating impact of Typhoon Noru, Thai rice exports could reach 8 million tonnes by the end of this year. Moreover, the weak Baht (Thailand’s currency) in comparison to the US Dollar has helped overseas sales.
According to Reuters, Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said that “floods resulting from the typhoon in late September and early October had caused some damage to crops but had not impacted exports.”
Chookiat said, “due to the weak baht and India’s export tax, we can still reach 7.5 million tonnes (of exports) this year and can reach 8 million as well.”
Thailand, the world’s third-largest rice exporter, shipped a total of 6.11 million tonnes of grain last year and produced a total of 214 million tonnes, which is 2.18 million tonnes more than the previous production.
According to a Global Agricultural Information Network report from the US Department of Agriculture Foreign Agricultural Service (FAS), owing to the floods, Thailand saw plenty of precipitation allowing the country to yield 20 million tonnes of rice in FY2022-23, which has increased by 2 percent in comparison to last year’s yield figures. When it comes to exports, they increased by 31 percent going from 6.1 million tonnes in 2021 to 8 million tonnes in 2022.
The Market Gap
Thailand capitalized on the market gap created by India after it banned broken-rice exports and imposed a levy of 20 percent on various grades of rice.
India’s move thoroughly impacted the markets as the country holds a behemoth share of 40 percent in the global rice trade and exports rice to over 150 countries. Vietnam and Thailand are second and third on the list of top rice exporters, while India is number one. Therefore, they are the best possible contenders for buyers looking to buy rice from around the world. With the rise in Rice Exports and increased pressure on the price of rice caused by India’s restrictions, Thailand will profit greatly.
According to trade sources, though the prices of rice in the domestic market are seeing a hike, the prices in the global market are showing a downward trend. The nations that import rice are resisting price hikes despite fears of a possible impact on paddy cultivation this year in Asia due to weather conditions.
Unless the country faces a dramatic change in the scenario, Thailand could witness a total of 8 million tonnes in exports even in 2023, as quoted by the Thai Rice Exporters Association. The export target set by TREA earlier was 7 million tonnes, but due to higher paddy yield and weak Baht, TREA raised its export target to 7.5 million.
It is noteworthy that multiple countries around Asia were hit with severe weather conditions, and some countries, like India, were forced to impose restrictions to stabilize the domestic market. However, Thailand’s rice exports had little impact, and the country’s weak currency turned advantageous.