Thai floods damage rice crop, raise export prices
Thai floods damage rice crop, raise export prices
BANGKOK (Reuter): Thailand's worst monsoon flooding in at least 12 years has destroyed more rice crops and sent Thai rice prices soaring this week, officials said yesterday.
An agriculture ministry official monitoring floods in more than 40 provinces said about 499,000 hectares of paddy (unhusked rice) fields have been ruined beyond salvage, up from 467,200 hectares a week ago.
Ministry officials estimated that about 1.05 million tons, or 5.8 percent, of the main 1995-1996 (May/January) paddy have been destroyed against 987,000 tons, or 5.5 percent, estimated a week ago.
The main paddy crop, which normally accounts for 85 percent of Thailand's total annual output, is now projected at 17.13 million tons against 18.18 million forecast early this month.
Ministry officials and traders said, however, actual total Thai rice output may not be substantially lower than earlier projections as this year's abundant rainfall and high-water levels behind dams will greatly increase the irrigated second November/April paddy crop.
Thai exporters yesterday quoted FOB rice prices US$10-$20 higher than a week ago, partly due to flood-related shipment problems, a low end-season supply and world shortages.
They quoted 100 percent B white Thai rice at about $385 FOB Bangkok, up from $375 a week ago. Ten percent white was quoted at $365 against $345 a week ago.
Current Thai rice prices are about $30-$70 a ton higher than a year ago, due mainly to shortages in major Asian producers including China, the Philippines and Indonesia.
"It's tricky to quote this week amid current high prices. I don't think prices can go much higher as buyers may try to hold back until the new Thai crop arrives in November," a major rice exporter told Reuters.
Commerce ministry officials said the government would seek to postpone for two months the delivery of about 140,000 tons of 100 percent B white rice to Iran originally scheduled by end-October.
The rice is part of 200,000 tons Iran ordered on a government- to-government contract earlier this year at about $293.5 per ton against a $380-385 market price this week.
The ministry officials said heavy flooding in Thailand prevented paddy from reaching rice mills and traders selling to the government.
A manager at Kamnan Song paddy market in north central Nakhon Sawan, the country's biggest, said flooding would delay this year's main paddy harvest for at least a month.
She said trade had also been hurt as widespread daily rains this month have raised the moisture of paddy delivered to the market, affecting its quality.
But she agreed with agriculture ministry officials that the final two-crop harvest this year may not be much lower than earlier annual average because of an expected bigger second crop.
An exporter said he expected some farmers would try to start harvesting the main crop in October in a bid to salvage flooded fields but the unmatured rice plants would yield low-quality, high-moisture grains that would fetch lower prices.