Rice exporters hit by fears of Ebola

Exporters of Thai rice to West Africa are starting to feel the impact of the Ebola virus crisis, as operators of large vessels have baulked at sailing to the area.

"It's now very difficult to find cargo ships to transport rice to Africa," said Vichai Sriprasert, honorary president of the Thai Rice Exporters Association. "At first, we did not think Ebola would be a big deal for our exports, but now most of the shipping companies are afraid that their crews will get the virus."

Africa is one of Thailand's key markets, particularly for parboiled rice. Last year, Thailand shipped 3.75 million tonnes of rice to the continent.

In the last six months, Thailand's rice shipments to Africa have increased 140% to 3.29 million tonnes. Benin received 620,000 tonnes, followed by Ivory Coast  (420,000), Cameroon (357,000), Mozambique (240,000), Nigeria (228,000) and South Africa (248,000).    

"We are afraid this incident may put pressure on rice prices," Mr Vichai said. "We have seen the price of Thai 5% white rice starting to ease from 13,000 baht a tonne last week to 12,500 baht and now 12,300 baht despite the fact that Thai rice prices should pick up, driven by relatively strong purchase orders from China for more than 100,000 tonnes a month." 

Thailand could sell more than 9 million tonnes of rice this year. China, whose shipments include newly harvested Hom Mali rice, is likely to take 1 million tonnes.

In the first six months of this year, Thailand shipped 4.7 million tonnes, a surge of 60% over the same period last year. 

Chookiat Ophaswongse, another honorary president, said the association in partnership with the Foreign Trade Department has clinched a deal with Indonesia to sell 175,000 tonnes of 5% and 15% white rice mainly from new harvests under a government-to-government contract. The private sector will handle the delivery.  

"This is a very good sign after Indonesia had halted rice purchases from Thailand since 2012, citing the substandard quality of the rice delivered," Mr Chookiat said. 

Indonesia's Bulog said in July it was considering imports of 250,000 to 500,000 tonnes of rice. Imports will depend domestic production and prices.

Thailand's military regime, which halted rice sales to carry out nationwide stock inspections, has resumed sales of 167,000 tonnes of rice the previous government stockpiled over the past two years during the expensive rice pledging scheme. Although the bidding drew an active response from bidders, the junta only sold 73,000 tonnes for 740 million baht. A second auction is expected next month for 100,000 tonnes. 

The junta in July vowed to sell an average of 500,000 tonnes a month from state stocks and dispose of the existing 18-million-tonne surplus within three years through four channels — general auctions, government-to-government sales, direct sales and the Agricultural Futures Exchange of Thailand.

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