Thailand to regain top rice exporter position
Editor’s Note: What was expected to be necessary at some point is happening. Thailand’s government is dumping much of the rice that it has had in storage, which was accumulated under the rice subsidy program for rice farmers. The country ran out of storage warehouses and the quality of the rice in storage was due to start deteriorating badly. Additionally, the government needs money to pay off financing of the subsidies. The country remains politically unstable partly because of the rice scheme. With all this as the backdrop, India is expected to drop from first place in rice export to second place. Thailand is poised to reclaim its top rice exporter position once again, but income into the country will take a hit because of the fire sale on rice.
India's rice exports could slide by nearly a quarter this year and knock the country off its perch as top exporter of the grain due to stiff competition from Southeast Asian rivals that have recently slashed prices, Indian industry executives said.
A drop in Indian exports could help Thailand trim a record inventory chalked up under a controversial rice-buying scheme. Thailand may also be able to reclaim its status as the world's biggest rice exporter, which it lost to India two years ago.
It will also leave more rice in Indian hands at a time when the country's stocks are bulging and it faces the prospect of a record harvest, creating problems of storage.
"We are almost out of the market now. Thailand and Vietnam are selling aggressively and it is difficult for Indian exporters to match those prices," B.V. Krishna Rao, managing director at Pattabhi Agro Foods Pvt Ltd, India's biggest non-basmati rice exporter, told Reuters.
"Thailand will again become the world's biggest rice exporter. Our non-basmati rice exports could drop to 4 million tonnes," Rao said.
India toppled Thailand in 2012 to become the world's biggest rice exporter after the government lifted a four-year-old ban on non-basmati rice shipments in 2011 to trim a growing mountain of the grain following bountiful harvests.
In the 2013/14 financial year that ended on March 31, India's total rice exports stood at a record 10.5 million tonnes, comprising 4 million tonnes aromatic basmati rice and 6.5 million tonnes of the non-basmati variety.
While India's shipments of the basmati variety are likely to remain steady in 2014/15 at around 4 million tonnes, total rice exports could drop to 8 million tonnes due to the slide in exports of non-basmati rice, industry officials said.
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