Thai rice exports are going to be difficult this year
Thai rice exports will have a hard time this year. Hom Mali (jasmine rice), which made up 30 percent of exports last year, faces strong competition from comparable quality rice from Vietnam and Cambodia. India is a formidable competitor in white rice.
Hong Kong and Singapore are the main export markets for Thai Hom Mali, who usually buy the newly harvested rice around Chinese New Year. Vietnamese jasmine rice will be available in March. According to traders in Hong Kong, the Vietnamese variety is gaining popularity; it is soft and has a good aroma. The only drawback is the appearance, because she has a short grain. The rice costs US$670 per tonne against Thai Hom Mali's $1.100.
Cambodia is also doing well. The quality of the rice is comparable in flavor and appearance to Thai rice and is also cheaper at $800 per ton.
The biggest risk factor for rice exports is not the government's mortgage system (with a high guaranteed price), but India and Vietnam. exported last year Thailand 10,7 million tons of rice, but Korbsook Iamsuri, president of the Thai Exporters Association, thinks that not even 9 million tons will be reached this year because of the cheap rice from those two countries. Cheap Indian rice depresses the market price, which Thai rice cannot compete with. India and Vietnam sell white rice for $400-450 a ton, Thailand $ 550-570.
As previously announced, if India exports 2 million tons and Vietnam raises its prices, exports could reach 9 to 10 million tons.
“The government wants the export price to be $800 per ton, but that will be difficult. We are hardly competitive at the current level,' says Korbsook.
Somkiat Makcayathorn, director of the Thai Rice Exporters Association, has already warned: Thailand should pay more attention to the quality of its rice. For example, the famous aroma of Thai Hom Mali rice is not what it was five years ago, he said.
Somkiat seems to be right, as the famous Thai jasmine rice has been beaten by the Burmese pearl pawsan variety. In a competition organized by the Rice Trader World Rice Conference 2011 in Ho Chi Min City last November, a select panel of rice connoisseurs preferred the Burmese rice for its unique aroma, firmness and beautiful texture.