Rice exports from Thailand, the world’s largest shipper, may slump as much as 6.6 percent after deadly anti-government protests hurt sales, compounding the impact of lower global demand, according to an industry group.
Exports may total 8 million to 8.5 million metric tons this year, Chookiat Ophaswongse, adviser to the Thai Rice Exporters Association, said by phone today, revising an earlier projection for a gain to as much as 9.5 million tons. Exports totaled 8.57 million tons in 2009.
Chookiat’s revised forecast illustrates the damage to Southeast Asia’s second-largest economy caused by the unrest, which peaked May 19 when a military assault cleared protesters from Bangkok. Riots and protests have killed more than 80 people, with curfews imposed in about a third of the nation.
“Thailand will see a sharp decline in exports in the third quarter as there are nearly no orders at the moment,” said Chookiat, who has served as the association’s president. Buyers have shifted to Vietnam as they are uncertain about the delivery of Thai rice, he said. Vietnam is the second-largest exporter.
The Thai economy may shrink in the third quarter “if the unrest can’t be settled,” Ampon Kittiampon, secretary-general at the National Economic and Social Development Board warned at a briefing today. The economy grew 3.8 percent in the first quarter from the previous three months, the government said.
Lower Shipments
“Weakening global demand is a key driver lowering exports this year,” Chookiat said. Rice exports in the July-to- September period may be about 550,000 tons to 600,000 tons a month compared with last year’s average of 700,000 tons, he said.
Rioting erupted across Bangkok last week as security forces cleared an anti-government protest camp, forcing the movement’s leaders to surrender. More than 30 buildings were set alight, including the Stock Exchange of Thailand’s building, the nation’s biggest shopping complex, and at least eight branches of Bangkok Bank Pcl, the country’s biggest lender.
The price of 100-percent Thai white rice, which sets a benchmark for the trade in Asia, was $481 a ton on April 28, according to Bloomberg data. Over the second half it may rise to more than $600, tracking a rebound in other grains, Chookiat said. It averaged $570 a ton so far in the first half, he said.
Rice production in Thailand in the next crop year -- which starts in October -- may match this year’s total, with the impact of a drought on next year’s harvest yet to be assessed, Chookiat said, without providing precise forecasts.
Source: Bloomberg