"Demand from India will be a key factor driving an increase," Chookiat Ophaswongse, president of the association, said in a Bloomberg Television interview today. "In terms of volume, 2010 will be a prosperous year for Thai rice."
Thai production in the crop year that began Oct. 1 may increase to 35 million tons, from an estimated 32 million tons in the 2008-2009 year, Chookiat said. Exports reached a record 10.14 million tons in 2004.
Global output may decline after drought in India cut the monsoon crop and storms in the Philippines destroyed at least 1 million tons. Rice, wheat and palm oil jumped to records last year, sparking concern among policy makers that there may be a food crisis as protests about prices broke out across the globe.
The price of Thai 100 percent grade-B white rice, the regional benchmark, "may increase to as high as $700 a ton in the next 12 months if India imports as much as 3 million tons," Chookiat said in a separate interview today.
"Even though next year seems to be a golden year for exporting countries, I don't think prices will go back to the 2008 high, when price went above $1,000 a ton," said Chookiat. The price reached a record $1,038 a ton in May 2008.
Gains in Thai prices may be limited because government stockpiles stand at 5 million to 6 million tons, compared with 2 million tons in 2008, Chookiat said.
The export price increased by 3 percent last week to $541 a metric ton, up from this year's low of $525 a ton in October. The Rice Exporters Association sets the price every Wednesday.
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