Rice exports to Thailand plummeted in the first four months of the year as a result of that country’s surplus, which reached record levels at the end of 2013.
Between January and April, Cambodia exported just 1,550 tonnes of rice to Thailand, down 89 per cent from the 14,250 tonnes shipped in the same period last year, according to the Ministry of Agriculture’s monthly reports.
Hun Lak, president of rice export firm Mekong Oryza Trade, said the decline was due to Thailand’s rice stockpiles, which were accumulated under a state purchasing program launched in 2011 and scrapped at the end of last year.
Thailand accumulated rice stockpiles of reportedly more than 12.8 million tonnes at the end of 2013, equal to about a third of the global export market.
“The overstock of rice in Thailand reduced the demand from Thai traders for Cambodian rice,” Lak said.
“Also, rice prices in Thailand are declining as a result, meaning buyers simply cannot make a profit by importing Cambodian rice,” he added.
Thai rice prices sunk from $1,100 per tonne to $950 per tonne in February as the state-run rice pledging scheme came to an end and the Thai government began selling off its stockpiles. Consequently, Cambodian exporters reduced their prices from $950 to $880 per tonne to compete.
Lim Bunheng, president of Loran Company, said Cambodian farmers depend on Thailand and Vietnam for exports largely due to a lack of local facilities to polish and clean rice – the final stage before the product is fit for international standards.
“I hope the situation will get better after June – when more of Thailand’s stockpiled rice is sold off – because it is having an impact on our industry now both in terms export volume and price,” he said.
Sok Puthyvuth, president of the Cambodia Rice Federation, called on rice exporters to seek other markets rather than “sitting and waiting” for the situation to get better.
“We should take this chance to start to diversify markets to potential countries like China, Indonesia as well as countries in the EU for our rice while waiting for Thailand to settle things,” he said.
Thailand imported 23,550 tonnes of Cambodian rice in 2013, making it the Kingdom’s sixth largest destination for rice exports.
Thursday 29 May 2014
Northern India to Endure Scorching Heat and Drought Due to Weak Monsoon
The yearly advance of the southwest monsoon is vital to both people and agriculture across India and rest of the Indian subcontinent.
The normal onset of the southwest monsoon occurs during the second half of May across Myanmar before reaching southern India at the beginning of June.
This year the monsoon was actually several days ahead of schedule reaching Myanmar, but it has stalled over the Bay of Bengal during the past week.
As a result, the onset of the monsoon in southern India will likely be up to a week late across parts of the south, but the beneficial rains are forecast to increase during the second week of June.
The heaviest rains are expected to be focused from the western Ghats to the west coast during this time. Scattered rains are expected across the southeast.
With an El Nino expected to build during the second half of the year, rainfall across central and northern India could be impacted greatly.
As a result, the northward advance of the southwest monsoon is forecast to be delayed for most of central and northern India allowing temperatures to soar well above normal for much of the month of June.
Several long stretches of temperatures over 42 C (108 F) are possible in New Delhi and the surrounding region.
Long-range forecasts are for below-normal monsoon rainfall in these areas, stretching into neighboring Pakistan. Concerns continue to rise that a drought will develop across northwest India and Pakistan as a result of prolonged dry and hot weather followed by a weak monsoon.
India is a large supplier of rice and cotton globally, and these crops could suffer greatly as a result of the impending hot and dry conditions. According to Accuweather.com Commodity Weather Expert Jason Nicholls, "Both crop yields and quality are likely to be impacted by drought later this summer in northwest India and Pakistan."
Farther south, the monsoon should arrive before the full impact of the oncoming El Nino occurs. The best chance for a near-normal monsoon will be in the southwest.
With rainfall expected to be below normal for much of India during this monsoon season, any rainfall from tropical cyclones would be increasingly important.
The Bay of Bengal will likely produce several tropical cyclones during the summer months as a near-normal season is anticipated. Although flooding is always a threat from landfalling tropical cyclones, this will be offset by the positives of rainfall during a stretch of otherwise below-normal rainfall.
The normal onset of the southwest monsoon occurs during the second half of May across Myanmar before reaching southern India at the beginning of June.
This year the monsoon was actually several days ahead of schedule reaching Myanmar, but it has stalled over the Bay of Bengal during the past week.
As a result, the onset of the monsoon in southern India will likely be up to a week late across parts of the south, but the beneficial rains are forecast to increase during the second week of June.
The heaviest rains are expected to be focused from the western Ghats to the west coast during this time. Scattered rains are expected across the southeast.
With an El Nino expected to build during the second half of the year, rainfall across central and northern India could be impacted greatly.
As a result, the northward advance of the southwest monsoon is forecast to be delayed for most of central and northern India allowing temperatures to soar well above normal for much of the month of June.
Several long stretches of temperatures over 42 C (108 F) are possible in New Delhi and the surrounding region.
Long-range forecasts are for below-normal monsoon rainfall in these areas, stretching into neighboring Pakistan. Concerns continue to rise that a drought will develop across northwest India and Pakistan as a result of prolonged dry and hot weather followed by a weak monsoon.
India is a large supplier of rice and cotton globally, and these crops could suffer greatly as a result of the impending hot and dry conditions. According to Accuweather.com Commodity Weather Expert Jason Nicholls, "Both crop yields and quality are likely to be impacted by drought later this summer in northwest India and Pakistan."
Farther south, the monsoon should arrive before the full impact of the oncoming El Nino occurs. The best chance for a near-normal monsoon will be in the southwest.
With rainfall expected to be below normal for much of India during this monsoon season, any rainfall from tropical cyclones would be increasingly important.
The Bay of Bengal will likely produce several tropical cyclones during the summer months as a near-normal season is anticipated. Although flooding is always a threat from landfalling tropical cyclones, this will be offset by the positives of rainfall during a stretch of otherwise below-normal rainfall.
Wednesday 28 May 2014
Jordan requests import of 20,000 tons of rice as exception to Egypt ban
Jordan’s Ministry of Industry and Trade submitted a formal request to the Egyptian Ministry of Industry and Foreign Trade last week to allow the import of 20,000 tons of Egyptian rice to Jordan as an exception to the ban on rice exports, said Issa Haider Murad, chairman of the Amman Chamber of Commerce.
“We have asked Egypt also to provide various agricultural products, supply commodities and fruits in order to compensate for the shortfall that Jordan witnessed in these categories following the deterioration of commercial traffic with Syria, as well as Jordan accommodates a large number of Syrian refugees, Palestinians and Egyptian workers,” he said.
Jordan imports a type of medium grain rice similar to Egypt’s products from a number of places including the United States, Spain and Italy, although the Egyptian variety is cheaper. Jordan imports other types of rice from Thailand and Pakistan, and the nation’s rice imports reach up to 80,000-100,000 tons per year.
Egypt consumes approximately 2.5m tons of white rice per year while it produces approximately 3.5m tons, translating into a surplus of up to 1m tons per year. Several years ago, the government began scaling back cultivation to cut water consumption, imposing a ban on exports in 2008.
Jordan was one of the first countries to declare its support for the roadmap announced by former defense minister and army chief Abdel Fattah Al-Sisi on 3 July last year, following the ouster of Islamist president Mohamed Morsi.
“We have asked Egypt also to provide various agricultural products, supply commodities and fruits in order to compensate for the shortfall that Jordan witnessed in these categories following the deterioration of commercial traffic with Syria, as well as Jordan accommodates a large number of Syrian refugees, Palestinians and Egyptian workers,” he said.
Jordan imports a type of medium grain rice similar to Egypt’s products from a number of places including the United States, Spain and Italy, although the Egyptian variety is cheaper. Jordan imports other types of rice from Thailand and Pakistan, and the nation’s rice imports reach up to 80,000-100,000 tons per year.
Egypt consumes approximately 2.5m tons of white rice per year while it produces approximately 3.5m tons, translating into a surplus of up to 1m tons per year. Several years ago, the government began scaling back cultivation to cut water consumption, imposing a ban on exports in 2008.
Jordan was one of the first countries to declare its support for the roadmap announced by former defense minister and army chief Abdel Fattah Al-Sisi on 3 July last year, following the ouster of Islamist president Mohamed Morsi.
Tuesday 27 May 2014
Rice in Thailand Climbing on Signs Army Won’t Allow Cheap Sales
Rice prices in Thailand are set to advance as much as 8 percent as the lowest rates in five years attract buyers and on speculation the military government won’t allow sales at cheap levels, exporters said.
The cost of the 5 percent broken variety may rise to $400 a metric ton from $370, Somkiat Makcayathorn, secretary general of the Thai Rice Exporters Association, said by phone yesterday. New-crop rates already increased $5 this week, said Mamadou Ciss, the president of Alliance Commodities (Suisse) SA.
The army last week removed the cabinet led by the Pheu Thai Party in a coup. The government started buying rice from farmers at above-market rates in 2011, boosting stockpiles to a level equivalent to about a third of annual global trade. Prices plunged 23 percent last year and the program lapsed in February. The junta-led National Council for Peace and Order will check the amount and quality of stockpiles before going ahead with sales, the commerce ministry said.
“We feel that we have to pay more than before,” said Ciss, who’s traded rice since 1984. “Thai rice is now the cheapest in the world” and demand has increased from China, Nigeria and Ivory Coast, he said by phone from Geneva.
Prices of 5 percent broken white rice from Thailand extended their decline by about 12 percent this year and Somkiat described the price of $370 as a market floor.
The rally will be limited by stockpiles in Thailand, Somkiat and Ciss said. State inventories stood at 16.7 million tons as of Feb. 11, the commerce ministry estimated. That compares with global trade of 41 million tons this year, U.S. Department of Agriculture data show.
Rising demand will boost Thai exports to 10 million tons this year, beating an earlier prediction of 7.5 million tons, Somkiat said. The country will regain its position as the world’s biggest shipper in 2015, the USDA estimates.
“The military government is signaling it won’t offload rice at cheap rates,” Chookiat Ophaswongse, the exporters’ association’s honorary president, said by phone. “This will prompt buyers to increase purchases as prices may continue to rise.”
The cost of the 5 percent broken variety may rise to $400 a metric ton from $370, Somkiat Makcayathorn, secretary general of the Thai Rice Exporters Association, said by phone yesterday. New-crop rates already increased $5 this week, said Mamadou Ciss, the president of Alliance Commodities (Suisse) SA.
The army last week removed the cabinet led by the Pheu Thai Party in a coup. The government started buying rice from farmers at above-market rates in 2011, boosting stockpiles to a level equivalent to about a third of annual global trade. Prices plunged 23 percent last year and the program lapsed in February. The junta-led National Council for Peace and Order will check the amount and quality of stockpiles before going ahead with sales, the commerce ministry said.
“We feel that we have to pay more than before,” said Ciss, who’s traded rice since 1984. “Thai rice is now the cheapest in the world” and demand has increased from China, Nigeria and Ivory Coast, he said by phone from Geneva.
Prices of 5 percent broken white rice from Thailand extended their decline by about 12 percent this year and Somkiat described the price of $370 as a market floor.
The rally will be limited by stockpiles in Thailand, Somkiat and Ciss said. State inventories stood at 16.7 million tons as of Feb. 11, the commerce ministry estimated. That compares with global trade of 41 million tons this year, U.S. Department of Agriculture data show.
Rising demand will boost Thai exports to 10 million tons this year, beating an earlier prediction of 7.5 million tons, Somkiat said. The country will regain its position as the world’s biggest shipper in 2015, the USDA estimates.
“The military government is signaling it won’t offload rice at cheap rates,” Chookiat Ophaswongse, the exporters’ association’s honorary president, said by phone. “This will prompt buyers to increase purchases as prices may continue to rise.”
Thailand Rice farmers overjoyed as payments begin
RICE FARMERS across the country were delighted as payments under the rice-pledging scheme resumed yesterday under the National Council for Peace and Order (NCPO).
I am so glad that the money has arrived," Chamnarn Taenghom from Phichit province said.
During the past six months, millions of farmers had desperately pressed for payments from the Yingluck Shinawatra-led administration to no avail. While the previous government blamed the months-long political turmoil as the main obstacle, critics blamed massive corruption. After the NCPO seized power, it vowed to prioritise the payments to farmers.
"We need money to invest in a new crop season," Chamnarn said.
According to the Phichit branch of the Bank for Agriculture and Agricultural Co-operatives (BAAC), it is paying more than 10,000 farmers under the Bt2-billion budget approved by the NCPO.
Additional funds are on the way. BAAC branches have been allocated different amounts, as the number of farmers at each branch differs.
Sa-ngob Bua-jan yesterday showed up at the BAAC's Khon Kaen branch and found that the payments had progressed to queue No 1023 already.
"I have two queue cards, one being No 1056 and the other being 1406. So I am convinced I will get my money soon," he said.
Sa-ngob, 66, thanked the NCPO for giving priority to rice farmers. Many farmers committed suicide recently due to the delayed payments.
Nupin Promta, a 47-year-old farmer, was overjoyed when she learnt that the BAAC had begun paying again. "I am told I will get money within five days," she said.
The BAAC branch in her hometown has already received a Bt650-million budget and will get more.
Elsewhere, payments to farmers under the rice-pledging scheme have also resumed.
In Uttaradit province, Boonrod Prabsamornchai received more than Bt236,000 from the rice-pledging scheme yesterday.
"It has revived my hope," he said.
Kittisak Rattanawaraha, who chairs the Network of Rice Farmers in the Lower North, said with the NCPO running the country all participants in the rice-pledging scheme believed they would be paid within one month.
"All farmers are delighted," he said.
In Sukhothai province, rice farmers joined more than 1,000 demonstrators in expressing support for the military. They handed flowers to a major-general at the Sukhothai City Hall.
I am so glad that the money has arrived," Chamnarn Taenghom from Phichit province said.
During the past six months, millions of farmers had desperately pressed for payments from the Yingluck Shinawatra-led administration to no avail. While the previous government blamed the months-long political turmoil as the main obstacle, critics blamed massive corruption. After the NCPO seized power, it vowed to prioritise the payments to farmers.
"We need money to invest in a new crop season," Chamnarn said.
According to the Phichit branch of the Bank for Agriculture and Agricultural Co-operatives (BAAC), it is paying more than 10,000 farmers under the Bt2-billion budget approved by the NCPO.
Additional funds are on the way. BAAC branches have been allocated different amounts, as the number of farmers at each branch differs.
Sa-ngob Bua-jan yesterday showed up at the BAAC's Khon Kaen branch and found that the payments had progressed to queue No 1023 already.
"I have two queue cards, one being No 1056 and the other being 1406. So I am convinced I will get my money soon," he said.
Sa-ngob, 66, thanked the NCPO for giving priority to rice farmers. Many farmers committed suicide recently due to the delayed payments.
Nupin Promta, a 47-year-old farmer, was overjoyed when she learnt that the BAAC had begun paying again. "I am told I will get money within five days," she said.
The BAAC branch in her hometown has already received a Bt650-million budget and will get more.
Elsewhere, payments to farmers under the rice-pledging scheme have also resumed.
In Uttaradit province, Boonrod Prabsamornchai received more than Bt236,000 from the rice-pledging scheme yesterday.
"It has revived my hope," he said.
Kittisak Rattanawaraha, who chairs the Network of Rice Farmers in the Lower North, said with the NCPO running the country all participants in the rice-pledging scheme believed they would be paid within one month.
"All farmers are delighted," he said.
In Sukhothai province, rice farmers joined more than 1,000 demonstrators in expressing support for the military. They handed flowers to a major-general at the Sukhothai City Hall.
Thai army rulers rush to placate rice farmers, boost economy
Thailand's new military rulers are moving fast to tackle economic problems caused by the absence of a proper government since December and are making it a priority to pay arrears owed to rice farmers, supporters of the government they ousted.
The military seized power on Thursday after nearly seven months of turmoil that hurt business confidence, halted much government spending and scared away tourists.
The economy shrank 2.1% in the first quarter and recession was on the cards.
Former Prime Minister Yingluck Shinawatra dissolved parliament in December and called an election for February.
From that moment, her caretaker government was unable to initiate new policies, even as the economy foundered, and found it impossible to raise funds for the troubled rice scheme.
The military has now torn up the constitution and the finance ministry has moved quickly to find money for the farmers, inviting banks to tender early next month to provide 50 billion baht (RM4.9 billion) in loans to fund the rice scheme.
"We have seen their intention to help farmers. This is an urgent issue," said Chaiyarit Anuchitworawong, a senior vice-president at Bangkok Bank Pcl, Thailand's top lender.
Gothom Arya, a lecturer in human rights studies at Mahidol University, did not think the urgency was necessarily political, designed to placate supporters of Yingluck, her Puea Thai Party and her brother, Thaksin Shinatra, another former premier deposed by the army in 2006 .
"There are hundreds of thousands of farmers in need of money and they are owed months of payment, which wasn't possible while both sides were squabbling," he said.
"The army isn't thinking right now about turning a pro-Thaksin electorate away from Puea Thai Party or any other pro-Thaksin party.
"My view is that they're thinking: let's solve one of the most pressing problems in the country first."
Whatever the motivation, 40 billion baht will be injected into the rural economy fairly quickly as the state-run Bank of Agriculture and Agricultural Cooperatives pays some of the 90 billion baht (RM8.8 billion) owed to farmers from its reserves.
The military government plans to pay the remaining 50 billion baht in less than a month, according to comments from coup leader General Prayuth Chan-ocha.
Air Chief Marshal Prajin Juntong, who is overseeing economic matters for the junta, told reporters after meeting top civil servants that the rice payments could add 0.2 percentage point to economic growth this year.
He said that would be on top of the forecast of 2% growth. That is the middle of the range forecast by the NESDB planning agency, which compiles Thailand's GDP figures.
Business leaders are expecting an economic stimulus package and are relieved that it should now also be possible to get a state budget ready for the new fiscal year from October 1.
Prajin, who is also chairman of flag carrier Thai Airways International, said the budget would be on time.
"This should be positive for the economy in the second half," said Surachai Kositsareewond, an executive vice-president at Bangchak Petroleum Pcl. "The clearer economic policies should help boost confidence and the private sector is ready to adjust."
The new government will roll over a cut in the corporate tax rate to 20%, which lapses in December, and an extension of the 7% value-added tax rate, before it reverts to 10% in September, Somchai Sajjapong, head of the Finance Ministry's fiscal policy office, told reporters.
The deposed government had planned to do this, but did not have the authority, leaving businesses up in the air.
The government will also extend cuts to income tax rates brought in at the end of 2013, Somchai said.
It will go ahead with some projects under a halted 2 trillion baht (RM195.8 billion) infrastructure plan, as well as parts of a 350 billion baht (RM34 billion) water management project drawn up after disastrous floods in 2011, but repeatedly delayed.
Somchai said he was confident the economy would grow more than 2% this year and that the ministry was hoping for 3%. To reassure financial markets, he said the military government had no intention of imposing capital controls.
The last military-led government in Thailand brought in draconian controls in December 2006, at a time when the baht was soaring. They caused the stock market to plunge 14.8% in a single day.
The military seized power on Thursday after nearly seven months of turmoil that hurt business confidence, halted much government spending and scared away tourists.
The economy shrank 2.1% in the first quarter and recession was on the cards.
Former Prime Minister Yingluck Shinawatra dissolved parliament in December and called an election for February.
From that moment, her caretaker government was unable to initiate new policies, even as the economy foundered, and found it impossible to raise funds for the troubled rice scheme.
The military has now torn up the constitution and the finance ministry has moved quickly to find money for the farmers, inviting banks to tender early next month to provide 50 billion baht (RM4.9 billion) in loans to fund the rice scheme.
"We have seen their intention to help farmers. This is an urgent issue," said Chaiyarit Anuchitworawong, a senior vice-president at Bangkok Bank Pcl, Thailand's top lender.
Gothom Arya, a lecturer in human rights studies at Mahidol University, did not think the urgency was necessarily political, designed to placate supporters of Yingluck, her Puea Thai Party and her brother, Thaksin Shinatra, another former premier deposed by the army in 2006 .
"There are hundreds of thousands of farmers in need of money and they are owed months of payment, which wasn't possible while both sides were squabbling," he said.
"The army isn't thinking right now about turning a pro-Thaksin electorate away from Puea Thai Party or any other pro-Thaksin party.
"My view is that they're thinking: let's solve one of the most pressing problems in the country first."
Whatever the motivation, 40 billion baht will be injected into the rural economy fairly quickly as the state-run Bank of Agriculture and Agricultural Cooperatives pays some of the 90 billion baht (RM8.8 billion) owed to farmers from its reserves.
The military government plans to pay the remaining 50 billion baht in less than a month, according to comments from coup leader General Prayuth Chan-ocha.
Air Chief Marshal Prajin Juntong, who is overseeing economic matters for the junta, told reporters after meeting top civil servants that the rice payments could add 0.2 percentage point to economic growth this year.
He said that would be on top of the forecast of 2% growth. That is the middle of the range forecast by the NESDB planning agency, which compiles Thailand's GDP figures.
Business leaders are expecting an economic stimulus package and are relieved that it should now also be possible to get a state budget ready for the new fiscal year from October 1.
Prajin, who is also chairman of flag carrier Thai Airways International, said the budget would be on time.
"This should be positive for the economy in the second half," said Surachai Kositsareewond, an executive vice-president at Bangchak Petroleum Pcl. "The clearer economic policies should help boost confidence and the private sector is ready to adjust."
The new government will roll over a cut in the corporate tax rate to 20%, which lapses in December, and an extension of the 7% value-added tax rate, before it reverts to 10% in September, Somchai Sajjapong, head of the Finance Ministry's fiscal policy office, told reporters.
The deposed government had planned to do this, but did not have the authority, leaving businesses up in the air.
The government will also extend cuts to income tax rates brought in at the end of 2013, Somchai said.
It will go ahead with some projects under a halted 2 trillion baht (RM195.8 billion) infrastructure plan, as well as parts of a 350 billion baht (RM34 billion) water management project drawn up after disastrous floods in 2011, but repeatedly delayed.
Somchai said he was confident the economy would grow more than 2% this year and that the ministry was hoping for 3%. To reassure financial markets, he said the military government had no intention of imposing capital controls.
The last military-led government in Thailand brought in draconian controls in December 2006, at a time when the baht was soaring. They caused the stock market to plunge 14.8% in a single day.
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