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Thailand’s rice export rebound continues in October
Vietnam stays out in entrance, set to hold on to second place
Exports boosted by return of West African, Iranian, Iraqi, Chinese language demand
Thailand’s month-to-month rice exports grew for a fifth consecutive month in October, placing the nation inside putting distance of reclaiming its title because the world’s second largest rice exporter in 2021.
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In keeping with knowledge from the nation’s Ministry of Commerce, October exports totaled 773,823 mt, up by 74% on the 12 months and the very best month-to-month complete since January 2019. That brings Thai exports in January-October 2021 to 4.59 million mt, marginally greater than this time final 12 months.
No nation will problem India’s pre-eminent standing on the world’s largest rice exporter, with January-September exports totaling 16.3 million mt and the nation on track to signify round two-fifths of worldwide rice exports in 2021. As in 2020, the one nation which stands in Thailand’s solution to the title of second largest exporter is Vietnam.
In keeping with Vietnam Customs, the nation’s January-October exports are nonetheless round 592,000 mt forward of Thailand’s, regardless of the nation’s strict regional lockdown throughout August-September. Whereas it could typically be protected to imagine that Vietnam will retain its place as second largest exporter in 2021, Thailand has witnessed a staggering development in exports in latest months. Exports reached a rare month-to-month low of 302,669 mt in March, however have since elevated by over 150% to succeed in October’s stage.
Moreover, sources have persistently reported in latest days that the federal government of Vietnam’s largest purchaser, the Philippines, has been limiting patrons’ entry to phytosanitary licenses which they should import. Whereas late within the 12 months, this might nonetheless show an obstacle to December exports from Ho Chi Minh Metropolis.
The principal motive for Thailand’s resurgence as a significant exporter in latest months has been its return to cost competitiveness. Thai 5% damaged white rice was assessed by S&P World Platts at as excessive as a $137/mt premium to its Indian equal in February this 12 months, however a collapse in Thai pricing following improved output meant that each merchandise have been virtually neck-and-neck for a lot of July-October.
Whereas a $20-$30/mt premium for Thai white rice has emerged in latest weeks, many patrons are nonetheless prepared to pay this because of the perceived premium high quality of Thai rice and the sometimes extra favorable popularity of its exporters on the subject of execution. Costs of Hom Mali and Pathumthani Aromatic varieties have additionally declined considerably in latest months, additional supporting demand for Thai rice.
Because of this, many price-conscious West African patrons have returned to Thailand for Aromatic, white and parboiled rice. Whereas remaining largely absent from the Thai market earlier within the 12 months – no West African nations featured as a high 10 export vacation spot in Could or June – Benin and Cote d’Ivoire have been Thailand’s high two export locations in October.
Uncommon demand has additionally aided Thai exports in latest months. Iraq’s return to the Thai market following a seven-year hiatus is probably the most outstanding improvement, with the nation taking 180,885 mt of Thai rice in 2021, in accordance with the Ministry of Commerce knowledge. The principal motive for the uptick in demand is that Iraq’s authorities divested rice sourcing tasks to an organization known as Al-Owais earlier this 12 months, which was far more open to non-Americas rice origins.
Moreover, neighboring Iran has been available in the market in latest weeks for giant volumes of Thai white rice, that are anticipated to be shipped in December and January. Whereas sources sometimes agree {that a} deal has been carried out for no less than 60,000 mt, some sources imagine that the ultimate confirmed quantity might be greater than double this if patrons can safe the required financing.
The world’s largest rice purchaser, China, has additionally been on a shopping for spree. From January-September, imports totaled 3.58 million mt, greater than double the 1.68 million mt imported over the identical interval in 2020, in accordance with the nation’s customs knowledge. This doesn’t exclude Thailand, with Thai exports to China to this point this 12 months roughly double that of final 12 months, making China Thailand’s third largest export market.
Whereas Thailand additionally faces exporting hurdles on the finish of the 12 months – particularly an absence of containers – it seems that even when the nation doesn’t reclaim its title because the world’s second largest rice exporter from Vietnam, it should probably be very shut.
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