Grain and Feed Update Bangkok Thailand 10 30 2017
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
POLICY
Required Report - public distribution
Date: 10/30/2017
GAIN Report Number: TH7143
Thailand
Grain and Feed Update
October 2017
Approved By:
Paul Welcher, Agricultural Attaché
Prepared By:
Ponnarong Prasertsri, Agricultural Specialist
Report Highlights:
Farmgate prices for rice and corn are under downward pressure as MY2017/18 supplies enter the
market. The government is considering additional measures to protect domestic corn farmers. Lower
rice prices will continue to assist Thai rice exports which are on track to reach a record 11 million
metric tons.
Post:
Bangkok
Executive Summary:
Rice prices are under downward pressure as supplies of MY2017/18 main crop rice enter the market.
This will help maintain Thai rice exports in the last quarter of 2017 as Thai rice export prices have
converged with other competitors. The government has proposed a soft loan program for farmer
institutions to purchase domestic corn at a recommended price that is 37 percent above the market
price. The government is also considering increasing the import tariff on feed wheat to help protect
corn farmers.
Post’s supply and demand forecast for rice, corn, and wheat remains unchanged from the previous
forecast in September 2017.
1. Rice Update
1.1 Production
Rice prices are under downward pressure as supplies of MY2017/18 main crop rice enter the market. In
October 2017, farmgate prices for white paddy rice declined 3-4 percent from the previous month
(Figure 1.1). Farmgate prices for fragrant paddy rice leveled off in October, ending the trend of rising
prices that occurred between July to September 2017. According to the Geo-Informatics and Space
Technology Development Agency’s (GISTDA) estimate, approximately 80 percent of MY2017/18 main
crop rice production will be harvested between mid-November and mid-December 2017. The Ministry
of Agriculture and Cooperative estimates that damage from flooding between July – October 2017 will
be minimal at around 1.4 million rai (224,000 hectares), accounting for approximately 2 percent of the
total main crop rice planted area.
Figure 1.1: Monthly Farmgate Prices of Paddy Rice
Post’s forecast for MY2017/18 rice production remains unchanged at 20.4 million metric tons. This is
approximately a 6 percent increase from MY2016/17. Additionally, MY2017/18 off-season rice
production is expected to increase 5 percent from the previous year due to sufficient water supplies.
The Royal Irrigation Department reported on October 25, 2017, that water supplies in the major
reservoirs totaled 13.7 billion cubic meters, which is 46 percent above last year’s water levels (Figure
1.2). According to the Thai Meteorological Department, cumulative precipitation during January –
October 2017 is 27 percent above the normal average and 23 percent above last year’s rainfall levels
(Figure 1.3).
Figure 1.2: Water Supplies in Major Reservoirs
Figure 1.3: Cumulative Precipitation by Region during January 1 – October 22, 2017
1.2 Trade
According to the Ministry of Commerce, Thai rice exports from January – September 2017 totaled
approximately 8.2 million metric tons, up 20 percent from the same period last year due mainly to
increased parboiled rice exports to Africa and the Middle East. During this time span, parboiled rice
exports totaled 2.2 million metric tons, up 51 percent from the same period last year. The recovery in
MY2016/17 off-season white rice production has caused Thai parboiled rice to be competitive with
Indian rice. Also, fragrant and white rice exports increased approximately 10 percent from the same
period last year, totaling 3.7 and 2.0 million metric tons respectively, due to the sale of government rice
stocks.
Downward pressure on Thai rice prices from new main crop rice supplies has caused Thai rice prices to
converge with competitors (Figure 1.4). As a result, Thai rice will likely continue to be competitive in
foreign markets and traders expect that Thailand will continue to export a monthly average of 0.9
million metric tons in the last quarter of 2017. In October 2017, export prices of Thai rice are U.S.
$920-940/MT for fragrant rice and U.S. $355-390/MT for white rice, compared to respectively U.S.
$980-1,000/MT and U.S. $360-400/MT in the previous month (Figure 1.5).
Figure 1.4: Monthly Thai Rice Exports by Variety
Figure 1.5: Weekly Export Prices of White and Fragrant Rice (FOB)
2. Corn Update
The government is considering a 45 billion baht (U.S $1.4 billion) soft loan program for farmer
institutions (agricultural cooperatives) to purchase domestic corn at 8 baht per kilogram (U.S. $240/MT)
which is 37 percent above current market prices. The proposed soft loan program’s objective would be
to raise the domestic price of corn, but there are concerns over the proposed program’s effectiveness as
the difference between the purchase price and the market price is greater than the reduced interest rate.
In October 2017, farmgate prices of corn declined to 5.9 baht per kilogram (U.S. $178/MT), down 3
percent from the same period last year (Figure 2.1).
Figure 2.1: Monthly Farmgate Prices of Corn (14.5% Moisture Content)
3. Wheat Update
The Thai government is considering raising the tariff rate on feed wheat to replace the domestic corn
absorption requirements that were implemented in January 2017. While the tariff for feed wheat has
been zero since September 2007, the government is currently studying the impact that a 27 percent tariff
on feed wheat imports will have on poultry and livestock production costs. While a higher tariff on feed
wheat will affect Black sea feed wheat imports, it should not affect feed wheat imports from Australia
due to the zero percent tariff rate under the Thai-Australian Free Trade Agreement.
Appendix Tables
Table 1.1: Thailand Rice’s Production, Demand and Supply
Rice, Milled
2015/2016
2016/2017
Market Begin Year
Jan 2016
Jan 2017
USDA
New
USDA
Thailand
Official
Post
Official
9444
9444
10247
Area Harvested
11270
11270
8403
Beginning Stocks
15800
15800
19200
Milled Production
23939
23939
29091
Rough Production
6600
6600
6600
Milling Rate (.9999)
300
300
250
MY Imports
300
300
250
TY Imports
0
0
0
TY Imp. from U.S.
27370
27370
27853
Total Supply
9867
9883
10500
MY Exports
9867
9883
10500
TY Exports
9100
9100
12000
Consumption and
Residual
8403
8387
5353
Ending Stocks
27370
27370
27853
Total Distribution
2.5348
2.5348
2.839
Yield (Rough)
New
Post
10247
8387
19200
29091
6600
200
200
0
27787
11000
11000
12000
2017/2018
Jan 2018
USDA
Official
10700
5353
20400
30909
6600
250
250
0
26003
10000
10000
11500
New
Post
10732
4787
20430
30955
6600
200
200
0
25417
10000
10000
11500
4787
27787
2.839
4503
26003
2.8887
3917
25417
2.8844
(1000 HA) ,(1000 MT) ,(MT/HA)
Table 1.2: Thailand’s Rice Area, Production and Yield
Table 2: Thailand’s Corn Production, Demand and Supply
Corn
2015/2016
2016/2017
Market Begin
Jul 2015
Jul 2016
Year
2017/2018
Jul 2017
Thailand
Area Harvested
Beginning
Stocks
Production
MY Imports
TY Imports
TY Imp. from
U.S.
Total Supply
MY Exports
TY Exports
Feed and
Residual
FSI
Consumption
Total
Consumption
Ending Stocks
Total
Distribution
Yield
USDA
Official
1090
139
New
Post
1090
139
USDA
Official
1168
172
New
Post
1168
172
USDA
Official
1100
143
New
Post
1100
143
4700
600
600
2
4700
600
600
0
5200
600
600
0
5200
600
600
0
4900
700
700
0
4900
700
700
0
5439
367
439
4800
5439
367
439
4800
5972
729
700
5000
5972
729
730
5000
5743
200
200
5300
5743
100
100
5300
100
100
100
100
100
100
4900
4900
5100
5100
5400
5400
172
5439
172
5439
143
5972
143
5972
143
5743
243
5743
4.3119
4.3119
4.4521
4.4521
4.4545
4.4545
(1000 HA) ,(1000 MT) ,(MT/HA)
Table 3: Thailand’s Wheat Production, Supply and Demand
Wheat
2015/2016
2016/2017
Market Begin
Jul 2015
Jul 2016
Year
USDA
New
USDA
Thailand
Official
Post
Official
0
0
0
Area Harvested
865
1002
Beginning Stocks 865
0
0
0
Production
4872
4691
3689
MY Imports
4872
4691
3689
TY Imports
679
632
696
TY Imp. from
U.S.
5737
5556
4691
Total Supply
235
235
242
MY Exports
235
235
242
TY Exports
3300
3276
2400
Feed and
Residual
2017/2018
Jul 2017
New
Post
0
885
0
4064
4064
707
USDA
Official
0
849
0
3000
3000
0
New
Post
0
687
0
3000
3000
700
4949
242
242
2800
3849
200
200
1500
3687
240
240
1500
FSI
Consumption
Total
Consumption
Ending Stocks
Total
Distribution
Yield
1200
1160
1200
1220
1300
1300
4500
4436
3600
4020
2800
2800
1002
5737
885
5556
849
4691
687
4949
849
3849
647
3687
0
0
0
0
0
0
(1000 HA) ,(1000 MT) ,(MT/HA)
End of report.
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
POLICY
Required Report - public distribution
Date: 10/30/2017
GAIN Report Number: TH7143
Thailand
Grain and Feed Update
October 2017
Approved By:
Paul Welcher, Agricultural Attaché
Prepared By:
Ponnarong Prasertsri, Agricultural Specialist
Report Highlights:
Farmgate prices for rice and corn are under downward pressure as MY2017/18 supplies enter the
market. The government is considering additional measures to protect domestic corn farmers. Lower
rice prices will continue to assist Thai rice exports which are on track to reach a record 11 million
metric tons.
Post:
Bangkok
Executive Summary:
Rice prices are under downward pressure as supplies of MY2017/18 main crop rice enter the market.
This will help maintain Thai rice exports in the last quarter of 2017 as Thai rice export prices have
converged with other competitors. The government has proposed a soft loan program for farmer
institutions to purchase domestic corn at a recommended price that is 37 percent above the market
price. The government is also considering increasing the import tariff on feed wheat to help protect
corn farmers.
Post’s supply and demand forecast for rice, corn, and wheat remains unchanged from the previous
forecast in September 2017.
1. Rice Update
1.1 Production
Rice prices are under downward pressure as supplies of MY2017/18 main crop rice enter the market. In
October 2017, farmgate prices for white paddy rice declined 3-4 percent from the previous month
(Figure 1.1). Farmgate prices for fragrant paddy rice leveled off in October, ending the trend of rising
prices that occurred between July to September 2017. According to the Geo-Informatics and Space
Technology Development Agency’s (GISTDA) estimate, approximately 80 percent of MY2017/18 main
crop rice production will be harvested between mid-November and mid-December 2017. The Ministry
of Agriculture and Cooperative estimates that damage from flooding between July – October 2017 will
be minimal at around 1.4 million rai (224,000 hectares), accounting for approximately 2 percent of the
total main crop rice planted area.
Figure 1.1: Monthly Farmgate Prices of Paddy Rice
Post’s forecast for MY2017/18 rice production remains unchanged at 20.4 million metric tons. This is
approximately a 6 percent increase from MY2016/17. Additionally, MY2017/18 off-season rice
production is expected to increase 5 percent from the previous year due to sufficient water supplies.
The Royal Irrigation Department reported on October 25, 2017, that water supplies in the major
reservoirs totaled 13.7 billion cubic meters, which is 46 percent above last year’s water levels (Figure
1.2). According to the Thai Meteorological Department, cumulative precipitation during January –
October 2017 is 27 percent above the normal average and 23 percent above last year’s rainfall levels
(Figure 1.3).
Figure 1.2: Water Supplies in Major Reservoirs
Figure 1.3: Cumulative Precipitation by Region during January 1 – October 22, 2017
1.2 Trade
According to the Ministry of Commerce, Thai rice exports from January – September 2017 totaled
approximately 8.2 million metric tons, up 20 percent from the same period last year due mainly to
increased parboiled rice exports to Africa and the Middle East. During this time span, parboiled rice
exports totaled 2.2 million metric tons, up 51 percent from the same period last year. The recovery in
MY2016/17 off-season white rice production has caused Thai parboiled rice to be competitive with
Indian rice. Also, fragrant and white rice exports increased approximately 10 percent from the same
period last year, totaling 3.7 and 2.0 million metric tons respectively, due to the sale of government rice
stocks.
Downward pressure on Thai rice prices from new main crop rice supplies has caused Thai rice prices to
converge with competitors (Figure 1.4). As a result, Thai rice will likely continue to be competitive in
foreign markets and traders expect that Thailand will continue to export a monthly average of 0.9
million metric tons in the last quarter of 2017. In October 2017, export prices of Thai rice are U.S.
$920-940/MT for fragrant rice and U.S. $355-390/MT for white rice, compared to respectively U.S.
$980-1,000/MT and U.S. $360-400/MT in the previous month (Figure 1.5).
Figure 1.4: Monthly Thai Rice Exports by Variety
Figure 1.5: Weekly Export Prices of White and Fragrant Rice (FOB)
2. Corn Update
The government is considering a 45 billion baht (U.S $1.4 billion) soft loan program for farmer
institutions (agricultural cooperatives) to purchase domestic corn at 8 baht per kilogram (U.S. $240/MT)
which is 37 percent above current market prices. The proposed soft loan program’s objective would be
to raise the domestic price of corn, but there are concerns over the proposed program’s effectiveness as
the difference between the purchase price and the market price is greater than the reduced interest rate.
In October 2017, farmgate prices of corn declined to 5.9 baht per kilogram (U.S. $178/MT), down 3
percent from the same period last year (Figure 2.1).
Figure 2.1: Monthly Farmgate Prices of Corn (14.5% Moisture Content)
3. Wheat Update
The Thai government is considering raising the tariff rate on feed wheat to replace the domestic corn
absorption requirements that were implemented in January 2017. While the tariff for feed wheat has
been zero since September 2007, the government is currently studying the impact that a 27 percent tariff
on feed wheat imports will have on poultry and livestock production costs. While a higher tariff on feed
wheat will affect Black sea feed wheat imports, it should not affect feed wheat imports from Australia
due to the zero percent tariff rate under the Thai-Australian Free Trade Agreement.
Appendix Tables
Table 1.1: Thailand Rice’s Production, Demand and Supply
Rice, Milled
2015/2016
2016/2017
Market Begin Year
Jan 2016
Jan 2017
USDA
New
USDA
Thailand
Official
Post
Official
9444
9444
10247
Area Harvested
11270
11270
8403
Beginning Stocks
15800
15800
19200
Milled Production
23939
23939
29091
Rough Production
6600
6600
6600
Milling Rate (.9999)
300
300
250
MY Imports
300
300
250
TY Imports
0
0
0
TY Imp. from U.S.
27370
27370
27853
Total Supply
9867
9883
10500
MY Exports
9867
9883
10500
TY Exports
9100
9100
12000
Consumption and
Residual
8403
8387
5353
Ending Stocks
27370
27370
27853
Total Distribution
2.5348
2.5348
2.839
Yield (Rough)
New
Post
10247
8387
19200
29091
6600
200
200
0
27787
11000
11000
12000
2017/2018
Jan 2018
USDA
Official
10700
5353
20400
30909
6600
250
250
0
26003
10000
10000
11500
New
Post
10732
4787
20430
30955
6600
200
200
0
25417
10000
10000
11500
4787
27787
2.839
4503
26003
2.8887
3917
25417
2.8844
(1000 HA) ,(1000 MT) ,(MT/HA)
Table 1.2: Thailand’s Rice Area, Production and Yield
Table 2: Thailand’s Corn Production, Demand and Supply
Corn
2015/2016
2016/2017
Market Begin
Jul 2015
Jul 2016
Year
2017/2018
Jul 2017
Thailand
Area Harvested
Beginning
Stocks
Production
MY Imports
TY Imports
TY Imp. from
U.S.
Total Supply
MY Exports
TY Exports
Feed and
Residual
FSI
Consumption
Total
Consumption
Ending Stocks
Total
Distribution
Yield
USDA
Official
1090
139
New
Post
1090
139
USDA
Official
1168
172
New
Post
1168
172
USDA
Official
1100
143
New
Post
1100
143
4700
600
600
2
4700
600
600
0
5200
600
600
0
5200
600
600
0
4900
700
700
0
4900
700
700
0
5439
367
439
4800
5439
367
439
4800
5972
729
700
5000
5972
729
730
5000
5743
200
200
5300
5743
100
100
5300
100
100
100
100
100
100
4900
4900
5100
5100
5400
5400
172
5439
172
5439
143
5972
143
5972
143
5743
243
5743
4.3119
4.3119
4.4521
4.4521
4.4545
4.4545
(1000 HA) ,(1000 MT) ,(MT/HA)
Table 3: Thailand’s Wheat Production, Supply and Demand
Wheat
2015/2016
2016/2017
Market Begin
Jul 2015
Jul 2016
Year
USDA
New
USDA
Thailand
Official
Post
Official
0
0
0
Area Harvested
865
1002
Beginning Stocks 865
0
0
0
Production
4872
4691
3689
MY Imports
4872
4691
3689
TY Imports
679
632
696
TY Imp. from
U.S.
5737
5556
4691
Total Supply
235
235
242
MY Exports
235
235
242
TY Exports
3300
3276
2400
Feed and
Residual
2017/2018
Jul 2017
New
Post
0
885
0
4064
4064
707
USDA
Official
0
849
0
3000
3000
0
New
Post
0
687
0
3000
3000
700
4949
242
242
2800
3849
200
200
1500
3687
240
240
1500
FSI
Consumption
Total
Consumption
Ending Stocks
Total
Distribution
Yield
1200
1160
1200
1220
1300
1300
4500
4436
3600
4020
2800
2800
1002
5737
885
5556
849
4691
687
4949
849
3849
647
3687
0
0
0
0
0
0
(1000 HA) ,(1000 MT) ,(MT/HA)
End of report.