Thai rice crop in irrigated areas delayed as canals still dry, exports to decline

Thailand’s main-crop rice production in the 2016-17 marketing year is delayed in irrigated areas and would impact exports as the canals remain dry, the U.S. Agriculture Department (USDA) said in a report.

It said the Royal Irrigation Department (RID) is yet to release water for farmers as it was preserving supplies for household consumption due to critically low reservoir levels.

The RID has indicated that it will not release water for rice farming until July.

The prolonged drought has resulted in tighter domestic supplies of new-crop white rice and contributed to a surge in Thai rice export prices during April through May 2016. Consequently, Thai rice exports are estimated to decline to 650,000 metric tons compared to the monthly average export volume of 950,000 metric tons during the first three months of 2016, the USDA report said.

Export prices of Thai white and parboiled rice during April – May 2016 increased by around $40/MT and $50/MT, respectively. Thai rice exports are likely to slow during the second and third quarter of 2016 due to tight supplies of new-crop white rice. Also, exporters reportedly have some quality standard issues with the old-crop rice in the government stocks, which have been sold aggressively since January 2016.

The forecast of rice exports in 2016 remains unchanged at 8 million metric tons, down18 percent from last year due to current tight supplies of new-crop white and parboiled rice, the report said.

 

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