Thai rice redemption price drops ahead of farming season

The upcoming farming season in Thailand, set to start this month, is witnessing a significant drop in the rice redemption price. This sharp decline, according to the Thai Agriculturist Association, is primarily due to market mechanisms and an oversupply of rice, particularly a Vietnamese variety.

Agriculturist Association President Pramote Charoensilp noted that during the first crop season of the year, which concluded in February, high demand for rice drove the redemption price in the central market up from 7,000–8,000 baht to 12,000–13,000 baht per tonne. This surge marked the most significant increase in a decade. However, the price has recently seen a downward trend, causing concern among farmers as the second crop season approaches.

Charoensilp identified the Vietnamese rice variety, Khao Hom Phuang or jasmine 85, as one of the key factors affecting the price drop. This particular variety is favoured due to its high yield, short growing period, and weather-resistant properties. It is estimated that this season, a million rai of rice plantations in Thailand will be cultivating this Vietnamese rice.

However, a source from the Thai Rice Mill Association has warned against this variety. It is characterised by a dull-white hue and is easily damaged during the milling process, making it less desirable for rice mills and exporters.

Echoing these sentiments, the Thai Agriculturist Association has implored farmers to refrain from cultivating foreign rice varieties to avoid negative impacts on local cultivars.

Rice Department (RD) Director-General Natthakit Khongthip confirmed that no Vietnamese rice varieties have been registered with the department so far. He pointed out that Thailand’s rice grain production does not meet farmers’ needs, driving them to seek foreign alternatives like the high-yielding Vietnamese variety that requires less farming time.

Khongthip added that the RD is making efforts to enhance local breeds to help Thai rice regain its popularity, although significant challenges remain.

In response to these developments, the Thai Agriculturist Association has called on the Department of Internal Trade to investigate any additional factors contributing to the price drop and examine the source of foreign rice grains being grown in Thailand.