Thailand Won’t Review Rice Mortgage Scheme, Says Thailand’s Deputy Prime Minister
January 17, 2012 (ByOryza News)
Thailand’s Deputy Prime Minister has said that there is no need for the government to review the rice pledging scheme as global demand for Thai rice is still high. The minister also downplayed concerns of the Thai Rice Exporters Association (TREA) over declining exports, saying that exporters do not appreciate the country’s bargaining ability.
Yesterday, the TREA had warned that Thailand may lose its position as the world’s top rice exporter to Vietnam as the rice mortgage scheme is making Thai rice uncompetitive in both local and international markets. The TREA had cited several reasons for the projected decline of rice exports share, including India’s re-entry to the export market, competition from Vietnam, Cambodia and Myanmar, and rising players such as Brazil and Uruguay. But all eyes are on the Thai government rice mortgage scheme which private exporters believe has pulled the country’s exports down. Honorary president of the association criticized the scheme by saying, "Thailand accounts for only 7 per cent of global rice production; the country will not be able to set the price of rice and direct global trade as the government expects."
Thai Deputy Prime Minister responded saying that the rice-pledging scheme will not be reviewed as the demand for Thai rice is still high. "We believe in our bargaining power and have great confidence in the quality of Thai rice, which brings a high price, so Thailand should not worry about what export volume our rivals can achieve. Buyers will still have to buy Thai rice." The minister added that rice exports are unlikely to drop to TREA’s estimated 6.5 million tons in 2012. He hinted that the reduction in rice exports last year was due to impact of floods on Thai rice production. He said competition from India and other countries will not impact the rice exports from Thailand.
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