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9 Jan 2024


Thailand’s native tapioca starch exports to China may not be bright in 2024 (Current Issue No.3447)


        It is expected that Thailand’s native starch shipments will face several challenges in 2024. These include the decline in cassava production due to the impacts of El Niño, particularly during 1Q24 when substantial amount of cassava output is expected to enter the market. Additionally, cassava mosaic disease will likely cause Thailand’s cassava production in 2024 to decline by approximately 6.3-10.0 percent YoY to 24-25 million tons. Meanwhile, it may be difficult for Thailand to import cassava because major import sources such as Lao PDR and Cambodia have seen declines in their cassava production due to the El Niño phenomenon, as well. As a result, Thailand’s cassava supply will be pressured, thus affecting the volume of the country’s native starch production and exports. Moreover, weak demand in China amid its slow economic recovery will likely pressure Thailand’s native starch exports to China in 2024.
        KResearch expects that the value of Thai native starch exports to China in 2024 will decline to 8 percent YoY or USD908 million, and the volume of Thai native starch exports will fall by around 9 percent YoY to 1.7 million tons. However, the export price of native starch may increase 1 percent to USD525/ton.
        Aside from income, Thai exporters may face challenges, including high processing costs, especially raw materials, which amount to around 75 percent of the total processing costs of native starch, plus other expenses, including labor and power may pressure net income of Thai native starch processors and exporters. Thai native starch exporters may also face increased competition from wheat  flour as China will likely opt to import more wheat flour because of the decline in global wheat flour prices. All these factors are set to pressure Thai native starch exports going forward.  
        If there are improvements in Thailand’s cassava production, Thai native starch exporters may consider boosting shipments to promising markets, including Malaysia, where there is demand for native starch to process Halal food products. Currently, Malaysia is the world’s important supplier of a wide range of Halal food products.