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    Home > Food News > Food Articles > Falling rice prices in Thailand signal economic crisis

    Falling rice prices in Thailand signal economic crisis

    • Last Update: 2021-07-30
    • Source: Internet
    • Author: User
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       Comprehensive Thai media reported on July 28 that Thailand’s agricultural land area is 150 million rai, and the total area of rice that can be grown is 6000 rai.
    The number of
    brown rice planting, consumption and
    export is the highest, and it affects Thailand as a whole and at the basic level.
    The economy, and the average price of 7,500 baht per ton is the lowest in several years, warning that economic problems are coming

    .
     
      According to the Thai Granary Association, the main reason for the drop in rice prices is the reduction in exports due to transportation factors.
    The other reason is that the new crown pneumonia epidemic affects the labor required to transport the rice, because more caution is required and transportation lags

    .
    As August and September enter the rice harvesting season, the problem is even more worrying.
    A large number of rice markets will inevitably cause prices to fall, which will affect farmers’ incomes.
    However, the cost of agricultural cultivation has continued to increase.
    Before, chemical fertilizers were 400-500 baht per ton, but It has now risen to 700 baht

    .
     
      The price trend of rice prices in the next 1-2 months will be even more severe, because a large number of new valleys will lower prices, and the good harvest brought by sufficient rainfall will be offset by the fall in corn prices, but the rise in farming costs and other issues are worrying
    .
     
      The data shows that Thailand produces 30 million tons of rice annually on average, and about 20 million tons of rice is ground into rice.
    Thais consume about 10 million tons of rice.
    For the remaining export markets, the situation of rice exports this year is also worrying

    .
     
      The Thai Rice Exporters Association stated that if 10 million tons of rice cannot be exported, this will lead to oversupply, and the price of rice exports will continue to fall.
    The main reason is the difficulty of logistics and transportation, including the complexity of the entire transportation process, many uncertain factors, and high transportation costs.
    Rise, especially the average increase in ocean freight rates is as high as 5 times

    .
    The shipping cost from Thailand to New York, USA, was US$2,500 per container before the COVID-19 pandemic, but now it has risen to US$12,500

    .
    A container loaded with 20 tons of rice, the average freight per ton of rice is 700 US dollars, almost equivalent to the price of rice, so that overseas markets are reluctant to import rice from Thailand, and instead consume rice in the United States or other markets

    .
     
      In addition, the new crown pneumonia epidemic has also affected the problem of labor required in the entire transportation system, making exporters have to consider their own export capabilities when receiving orders
    .
    Currently affected by the depreciation of the Thai baht, Thai rice prices are competitive, and this situation is likely to continue until the end of the year

    .
    However, the prospect of exporting rice is still unclear, because there are major problems in logistics and transportation, and the shortage of containers has reached the point where it is not necessarily costly, but there are too many uncertain factors

    .
    Therefore, the acceptance of orders is also uncertain, and the quantity is also decreasing

    .
     
      The decline in the amount of rice exports will eventually affect domestic grain prices and farmers’ incomes.
    The solution to the problem is to speed up the convenience of logistics and transportation, because the epidemic has not yet improved and has a trend of intensification

    .
    The greater Thailand’s export growth, the greater the demand for containers.
    Therefore, it is preliminary estimated that this year’s rice exports will be about 5-5

    .
    Brown rice export
     
      According to the Thai Granary Association, the main reason for the drop in rice prices is the reduction in exports due to transportation factors.
    The other reason is that the new crown pneumonia epidemic affects the labor required to transport the rice, because more caution is required and transportation lags

    .
    As August and September enter the rice harvesting season, the problem is even more worrying.
    A large number of rice markets will inevitably cause prices to fall, which will affect farmers’ incomes.
    However, the cost of agricultural cultivation has continued to increase.
    Before, chemical fertilizers were 400-500 baht per ton, but It has now risen to 700 baht

    .
     
      The price trend of rice prices in the next 1-2 months will be even more severe, because a large number of new valleys will lower prices, and the good harvest brought by sufficient rainfall will be offset by the fall in corn prices, but the rise in farming costs and other issues are worrying
    .
     
      The data shows that Thailand produces 30 million tons of rice annually on average, and about 20 million tons of rice is ground into rice.
    Thais consume about 10 million tons of rice.
    For the remaining export markets, the situation of rice exports this year is also worrying

    .
     
      The Thai Rice Exporters Association stated that if 10 million tons of rice cannot be exported, this will lead to oversupply, and the price of rice exports will continue to fall.
    The main reason is the difficulty of logistics and transportation, including the complexity of the entire transportation process, many uncertain factors, and high transportation costs.
    Rise, especially the average increase in ocean freight rates is as high as 5 times

    .
    The shipping cost from Thailand to New York, USA, was US$2,500 per container before the COVID-19 pandemic, but now it has risen to US$12,500

    .
    A container loaded with 20 tons of rice, the average freight per ton of rice is 700 US dollars, almost equivalent to the price of rice, so that overseas markets are reluctant to import rice from Thailand, and instead consume rice in the United States or other markets

    .
     
      In addition, the new crown pneumonia epidemic has also affected the problem of labor required in the entire transportation system, making exporters have to consider their own export capabilities when receiving orders
    .
    Currently affected by the depreciation of the Thai baht, Thai rice prices are competitive, and this situation is likely to continue until the end of the year

    .
    However, the prospect of exporting rice is still unclear, because there are major problems in logistics and transportation, and the shortage of containers has reached the point where it is not necessarily costly, but there are too many uncertain factors

    .
    Therefore, the acceptance of orders is also uncertain, and the quantity is also decreasing

    .
     
      The decline in the amount of rice exports will eventually affect domestic grain prices and farmers’ incomes.
    The solution to the problem is to speed up the convenience of logistics and transportation, because the epidemic has not yet improved and has a trend of intensification

    .
    The greater Thailand’s export growth, the greater the demand for containers.
    Therefore, it is preliminary estimated that this year’s rice exports will be about 5-5

    .
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