Thai drought may hit price of rice: Little impact on Singapore

Straits Times 10 Jun 10;

SINGAPORE imports as much as 80 per cent of its rice from Thailand, but importers here are not worried about supply shortages - just yet.

The Singapore General Rice Importers Association says there would be minimal impact on suppliers and consumers here if there is a reduction in Thai rice exports.

Mr Andrew Tan, who is the association’s chairman, says there are enough safeguards in place here to ensure sufficient supply of rice.

'The government has a policy of stockpiling supplies which would assure consumers of sufficient rice in the market,' he said.

In the unlikely event that stocks from Thailand run dry, existing supplies would last four to five months.

Singapore also has other suppliers.

Aside from Thailand, the rest of the rice in Singapore is imported from countries such as Vietnam, Myanmar and China.

Last year, trade promotion body IE Singapore announced that it would enhance its rice supply monitoring system to counter the possibility of a price increase caused by shortfalls in imports from Thailand.

KEVIN TAN
Thai drought may hit price of rice
Output could drop to less than half of earlier forecast
Straits Times 10 Jun 10;

BANGKOK: The world's largest rice exporter, Thailand, is facing major losses to its next crop of rice and a water crisis because of the worst drought in nearly two decades.

Mr Chanchai Rakthananon, president of the Thai Rice Mills Association, said rice output for the next crop cycle which ends in August could fall to as little as two million tonnes from a previously forecast five million tonnes.

'It didn't rain when it needed to rain,' said Mr Angsumal Sunalai, director-general of the Thai Meteorological Department.

Mr Chalit Damroengsak, director-general of the Royal Irrigation Department, said there would normally be three to four monsoon storms a year during the annual rainy season, 'but farmers will be lucky if there is one this year'.

Thailand produces about 20 million tonnes of rice annually in two to four crop cycles, exporting about nine million tonnes and consuming the same amount.

The government keeps a rice reserve of about 10 per cent of output, mostly as a way of stabilising prices, so the drought will not cause food shortages.

But Thailand will face a water crisis if reserves are not refilled and demand for water continues to soar, said Mr Chalit.

The agricultural sector consumes 70 per cent of the nation's water supply, he said, while human consumption accounts for only 4 per cent.

Water levels in medium- to large-sized reservoirs nationwide are at 15 per cent of total capacity. In some regions, local officials have asked farmers to postpone rice planting by one month for fear of depleting the reserves.

The Meteorological Department predicts heavy rain for the next three months, but that poses more of a problem than a solution for rice farmers, because flash floods can wipe out planted seedlings.

Farmers, like Ms Jundang Rintorn, 46, in the north-eastern province of Si Sa Ket, feel squeezed.

'Too much rain would mean losing money. We have to learn to adapt to this new pattern,' she said, speaking of the irregular weather.

Although the government implemented a price guarantee scheme last month to insure farmers against prices falling below a minimum, profit margins are shrinking because of higher production costs.

On Tuesday, Prime Minister Abhisit Vejjajiva asked the Agriculture Ministry to find ways to avoid the drought-induced problems next year.

Lower Thai rice production could have an impact on the world price of the staple, said Mr Rex Estoperes, a spokesman for the National Food Authority of the Philippines, which is the world's biggest rice importer.

ASSOCIATED PRESS