Over the past 10 years, Thai rice exports have faced challenges from both internal and external factors. Whether drought occurs more often increases world rice production and competing countries develop better rice varieties Causing Thailand to lose more and more share of the world rice market. While main competitors such as Vietnam and India can maintain or increase their export market shares.
Thailand’s rice exports fell 25 percent from the previous year, while Vietnam’s rice exports fell only 2 percent due to a rice export ban to maintain the domestic rice supply during COVID-19, and India’s exports have increased by more than 40 percent due to increased productivity. As a result, Thai rice exports fell to third place from their former position at the top.
Let’s take a closer look at why the market share of Thai rice in the world market is declining.
Thai rice varieties are not in demand in the market, can’t compete on price because “more expensive.”
Thai rice is more expensive than its competitors. In the past, Thai rice was more expensive by $100/ton while nowadays “Price difference” 5% rice in Thailand is $ 420, India $ 338, Vietnam $ 370, Pakistan $ 358, Myanmar $ 350, with the observation that if the price gap of rice exceeds $ 50, it is difficult to compete already.
In the past, the Philippine government used a G-G system for importing rice through the NFA agency. The Philippines therefore chooses to buy soft ground white rice from Vietnam that is cheaper than Thai white rice. As a result, the total amount of rice exports to the Philippines between 2020-2021 is reduced to only 70,000-100,000 tons from what was previously exported. 700,000–800,000 tons, with Vietnam being able to sell up to 2.4 million tons to the Philippines.
Our mission now is not to find new markets, but to win the original rice markets back, such as the Singapore and Hong Kong markets. Thailand used to have a market share of 80–90%, or 300,000 tons a year. Nowadays, these two markets have turned to buying more Vietnamese rice, causing the Thai market share to be about 50% or 100,000 tons.
The African market used to import mixed aromatic rice from Thailand each year. 700,000–800,000 tons, but now there is no imported tablet. because it was pulled by Vietnamese rice. the jasmine rice market, which Vietnam has already begun to invade. year before exporting 30,000–40,000 tons, while America and Canada are markets for premium jasmine rice. Now Vietnam has begun to enter. And there is also fragrant rice from Cambodia entering the competition as well. The same goes for the fragrant rice market in China, where Vietnamese and Cambodian fragrant rice enter.
Therefore, if Thailand has not changed, the market for premium jasmine rice will continue to decline. The rice consumption market in Thailand of 10 million tonnes is usually half as well, because 30-40 million tourists have disappeared after COVID.
As for Thai rice, it is losing its main export market because “Thailand does not have soft rice” like this year, when it has just begun to develop. “Soft ground rice variety 79” came out, but the price was still quite high or not competitive. Therefore, we have to focus on the domestic market first, like 5-6 years ago, Thailand started to plant “Hom Phuang Rice” from Vietnam.
It now has better productivity. The price of Hom Phuang rice grown in Thailand has dropped from 16–17 baht per kilogram to 13–14 baht per kilogram, or close to the price of white rice sold at 12–13 baht per kilogram, making rice exports possible in 2022. Fragrant Hom Phuang to be the standard Thai Fragrant Rice.
Because this rice can make export prices close to Vietnam’s “Jasmine 85” fragrant rice, the original jasmine rice in Thailand used to be very expensive, at $ 1,000 per ton, now it has to reduce the price gradually to only $ 700-800, while fragrant Pathum rice is sold for about 600 more coin only.
In addition, it was found that the price of rice in Vietnam is not too volatile; prices remain constant, making it easy to market rice to customers. Unlike Thai jasmine rice, the market price fluctuates, making it difficult to negotiate prices with customers.
The World’s Best Rice 2022
The 2022 World Rice Conference was held in Phuket on November 17. There was a competition for rice varieties from nine countries: Thailand, Vietnam, Cambodia, Myanmar, Laos, India, Pakistan, China, and the United States. It appears that Pakalamduan jasmine rice from Cambodia has won the best rice award in the world. As for jasmine rice, Thailand lost the championship in second place, and in third place was fragrant rice from Vietnam.
In the future, the neighbor’s jasmine rice will develop into a formidable competitor for all Thais. For example, in Laos this year, they entered the competition and reached 4th place, which warned that Thailand must seriously develop itself to have better rice varieties, including taking care of production costs to reduce and productivity per rai must be increased. At the same time, species must be developed to be more diverse.
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