In 2010, Thailand is facing a host of problems related to rice exports. They include a decline in the export volume as importing countries have increasingly switched to other cereals, plus heightened competition from Vietnam that has been able increase their rice exports steadily.
The volume of our rice exports has gradually fallen closer to that of Vietnam. It is expected that Vietnam's rice exports will exceed their target of 3.4 million tons in 1H10, while the Thai rice export volume has been lower than average (monthly volumes) that we achieved in 2009. Over-month, our rice exports began to decline below 2009 levels in February 2010 (except in March). In addition, our April rice exports began a trend of lower volume than that of Vietnam for two consecutive months – the first time ever in the history of Thailand's rice exports. This underscores the intense competition in the global rice market, thus forcing Thailand to lower our rice export target for 2010 to 8.0-8.5 million tons, down from the 9.0 million tons targeted earlier in the year.
It is expected that these problems will continue to confront Thai rice exports in 2011 and could get worse if India resumes rice exports. India is a major rival in African and Middle Eastern markets. Nevertheless, a positive factor that may help our rice exports next year could be an upswing in rice demand as rice cultivation might be adversely affected by unfavorable weather conditions globally.