World Economy

Thailand to Regain Top Rice Exporter Spot

Thailand to Regain Top Rice Exporter Spot  Thailand to Regain Top Rice Exporter Spot

Two years after losing its place as the world’s biggest rice exporter, Thailand is eyeing a return to the top spot as the impact of a bungled subsidy scheme eases and it sells cheaper grain to a grateful global market.

The subsidy, which offered farmers up to 50 percent above market rates for their rice, helped former premier Yingluck Shinawatra win the rural votes she needed to take office in 2011, AFP reported.

But it also sent tremors through the world market before spectacularly unraveling, leaving Thailand with around 18 million tons of over-priced rice and Yingluck skewered by a corruption charge.

Thailand was pushed off the top spot by India in 2012, as buyers hit back at the kingdom’s attempt to fund the costly subsidy by driving up global prices through grain hoarding.

India and Vietnam moved swiftly to gobble up Thailand’s crumbling market share, with the Indian government rapidly releasing more of their own rice for export.

Thailand’s junta, which seized power in May, ended the rice scheme soon after the coup and is flogging stockpiles to soften the price of Thai rice to around $450 a ton -- comparable to India and Vietnam.

Many now predict the kingdom’s industry is again set to surge.

 Returning to Top Spot

From January until September 2, the kingdom sold seven million tons of the grain -- already more than for the whole of 2013 -- according to Chookiat.

It should sell 10 million tons by the end of the year, as experts call for farmers to focus on producing higher quality -- and higher value -- strains of rice.

Much also depends on India, after New Delhi flooded lower premium rice to the export market to off-set the retreat of the Thai grain and avert a feared global food crisis.

Thailand’s military rulers are talking tough on the kingdom’s subsidy culture -- including rice and other major exports such as rubber.

Critics pilloried Yingluck’s flagship rice policy for damaging Thailand’s biggest export by paying farmers for large harvests irrespective of the quality.

Yingluck was found guilty of negligence linked to the scheme and now could face impeachment proceedings that may see her banned from politics.