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22 Jul 2019

Agriculture

Cassava mosaic virus may not damage output in 2019...but still poses challenges for the government to manage (Current Issue No.3010)

            Regarding the ongoing cassava mosaic virus epidemic, KResearch views that in 2019 the cassava mosaic virus epidemic may not damage the overall cassava output for this year because normally a small amount of cassava will enter the market in the second half of the year. The cassava price in 2H19 is likely to stay in the range of THB1.7-1.8 per kilogram, versus THB2.02 per kilogram in 1H19. The outlook for cassava this year is not promising because the cassava price is likely to stay at THB1.9 per kilogram on average, or a drop of 20.1 percent YOY. The fall is attributed mainly to a decreasing demand in China because corn stockpiles in China remain high. In 2019, China's corn stockpiles are expected to reach 209.8 million metric tons, compared to an average volume of stockpiles in the past five years (2014-2018) of 213.5 million metric tons per year.

                  Therefore, the government is facing the big question of how to deal with problems related to cassava output in 2H19 and prevent the cassava mosaic virus from spreading in order to curb the impact on the cassava output in 1Q20.  Measures may include compensation for farmers whose cassava output was damaged by the cassava mosaic virus and a government marketing campaign to boost domestic demand for cassava.  These measures may help shore up the falling cassava price and increase income for cassava growers. 



Agriculture