Source: thesaigontimes.vn
Mr. Chokam Ophaswongse, Honorary President of the Thai Rice Export Association (Trea) revealed that, in the first 3 months of the year, Thailand only exported 2.1 million tons of rice, a sharp decrease of 30% over the same period last year.
The main reason is that white rice exports 53% when India returns to the international rice market and large customers like the Philippines to reduce imports from 4 million tons last year to expected to 1 million tons this year.
Fierce competition from India and Vietnam made Thai exporters insecure. Indian rice is 40 dollars cheaper than Thai rice, causing countries like South Africa, Malaysia and the Philippines to buy Indian rice. Thai rice is still inferior to $ 600/ton last year to more than $ 400/ton.
India has exported 2.4 million tons and is expected to exceed 20 million tons in the year, while Vietnam’s rice exports reach 2.3 million tons, ready to overtake Thailand to become the second largest rice exporting country in the world this year.
Chokam predicts that rice export activities in the second quarter will continue to decrease sharply equivalent to the first quarter, but Trea still sets the goal of exporting 7.5 million tons of the whole year.
The key factors affecting Thai rice include US import tax policies, fluctuating market conditions and opportunities from China. With the price of white rice in Thailand only $ 400/ton compared to $ 500/ton of China, Beijing can increase imports to compensate for the lack of rice. But Thailand still has to “fight” with Vietnam, India and Pakistan to access the Chinese market.
In the US, importers are increasing the purchase of aromatic rice storage (Jasmine Rice) when the reciprocal tax of 36% is applied to Thailand to be delayed 90 days, instead of a basic tax rate of 10%.
In 2024, the US imported 1.3 million tons of global fragrant rice, of which 630,000 tons from Thailand. Particularly in the first quarter of this year, Thailand exported more than 200,000 tons of fragrant rice to the US for $ 1,000/ton. Plus other types of rice, the export number to the US reached 830,000 tons. But if the US increased tax to 20-25% or 36%, the cost of importing Thai fragrant rice into the US could skyrocket to $ 1,200-1,300/ton, making it difficult for Thailand to compete.
Mr. Chokam Ophaswongse pointed out that Vietnamese fragrant rice, despite facing the reciprocal tax rate of 46%, still has a significant lower price, from US $ 600-700/ton. This price distance can cause US rice importers to transfer to Vietnamese rice suppliers.
Last year, Thailand exported 850,000 tons of fragrant rice to the US, compared to only 40,000 tons from Vietnam. However, if the US imposed a new tax, the situation could change quickly.
Chokia Ophaswongse urged authorities to support rice exporters and accelerate tax trade talks with the United States to prevent further damage.
Charoen Laithamatas, President of Trea, is concerned about not only US taxes but also for shipping costs. Starting from October, the US is expected to impose a new port fee of up to millions of dollars for each shipment to the US shipping by Chinese ship, which can push the shipping cost by 6 dollars for each ton of rice.
Thai farmers are in a state of financial tensions because domestic rice prices fell 30% after India resumed exports in September last year.
Analysts said that Thailand is not able to reduce rice prices to compete.
“Our rice production costs are high, while productivity is low. If we reduce export rice prices, farmers will not be able to maintain farming,” Somporn Isvilanonda said.
The rice industry and farmers are putting hope in the negotiations between the Thai delegation led by Finance Minister Pichai Chunhavajira and the United States.
The concessions that Thailand proposes to include tax reduction for US corn from 73% to zero, will also harm Thai farmers.
A wave of low -cost imported corn can reduce the price of broken rice and rice bran, by -products created in the process of grinding rice and used for animal feed, Banjong Tangchitwattanakul, president of the Thai Rice Slatting Association.
Four farmer organizations, including rice mill have proposed the government to block the import of US soybeans and soybeans on the grounds that it will reduce the price of domestic food used as animal feed.
The Thai government committed that any concessions made in talks with the US will not weaken domestic industries.
