Markets/Trade
- Bloomberg reports that the fierce competition and declining prices seen in global rice markets are expected to worsen as Thailand’s rice stockpiles are added to global surplus. With the Thai government unable to extend its subsidy program and farmers demanding sales from government stockpiles to pay its debts to growers, traders are concerned about the effect of the stockpiles entering the global market, noting that “If they are sold too soon and all at once, the global price will fall, but if they are sold too late then the quality will continue to deteriorate.”
- Oryza.com reports that Thailand’s Prime Minister is to face criminal charges for her failed rice mortgage program which has cost the country billions and created an atmosphere of political unrest. The report notes that the government is estimated to have 18 million tons of rice in storage, 3 times the country’s annual usage, obtained at an estimated loss of $12 billion. While there are fears that dumping the stockpiles on the global market too fast will cause a drop in global rice prices, the uncertainty of the actual size and quality of the stockpiled rice, combined with the potential for greatly reduced production in Thailand this year, could potentially see prices gain instead.
- Chanyaporn Chanjaroen and Khalid Al-Ansary report for Bloomberg that Iraq has banned rice imports from Thailand, claiming poor quality and underweight shipments. Iraqi officials say they will meet with their Thai counterparts to discuss the issue, though a date for the discussion has not yet been announced. In the meantime, Iraq has begun purchasing from the U.S. and Uruguay, as both countries provide higher quality rice to offset higher prices.
- Oryza.com reports that the Myanmar Rice Federation has called for improved government policies to boost rice production and allow farmers to compete with those in neighboring countries. The Federation claims that current policies are too generalized, and the government needs to implement and a more precise and strategic policy differentiating and supporting all aspects of the rice industry.
