Local paddy prices are expected to rise in line with global market trends once the market absorbs large new supplies from Vietnam, says the Commerce Ministry.
Despite projections of a large paddy harvest of around 4 million tonnes this month and 1.3 million in June, prices are still between 8,200 and 8,300 baht a tonne, higher than the government's benchmark of 8,188 baht set for next week under its price insurance programme.
Yanyong Phuangrach, the ministry's permanent secretary, said farmers were satisfied with current market prices, as reflected in the lower numbers of farmers selling paddy to the Public Warehouse Organisation, the ministry's marketing arm appointed to handle state market intervention policy.
"Farmers are selling their harvest to rice millers for higher prices," he said.
The diminishing amount of Vietnamese rice entering the global market has helped to lift the FOB price of 5% white rice to US$485 a tonne, about $5 higher than for Thai rice of the same quality. As of March, Vietnamese white rice was trading at $465 a tonne, down from $475 in February.
Moreover, some rice exporting countries have problems filling their own own domestic stocks, with little left for export.
Mr Yanyong said Thailand, as of Tuesday, had exported 4.04 million tonnes of rice or 47% more than in the same period last year, for a value of 69 billion baht, up 24% year-on-year. Full-year exports of 9.5 million tonnes are expected.
(Source: http://www.bangkokpost.com/business/economics/235754/rice-to-gain-as-vietnam-stocks-absorbed)
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