According to reports from the U.S. Department of Agriculture’s Foreign Agricultural Service, Thailand’s forecast for 2015-2016 off-season rice production remained unchanged as the Roy Irrigation Department is expected to restrict irrigation water supplies in the next couple months.
The dry season, which runs from November-April 2016, has seen water supplies for all uses sitting 35% lower than in 2014 and 64% lower than the 10-year average reported World-Grain.com.
The government has announced bans on off-season rice farming due to inadequate water supplies, which will be mainly reserved only for household use. The RID has taken a hard stance since September that no irrigation stations will be authorized to supply water for the off-season rice crop. Despite these announcements, some areas will be planted but it will be much lower than in previous years. Farmers in upstream areas in the central plains have already prepared the land for planting off-season rice.
In response, the Thai cabinet has approved a program under which the Bank for Agriculture and Agricultural Cooperatives will provide soft loans to farmers and farmer institutions including in it interest rate compensation.
Additionally, an on-farm pledging program for fragrant rice was announced to help prevent possible falling domestic rice prices during market year 2015-16 main-crop rice harvest.
The forecast for market year 2015-16 rice production remains unchanged at 16.4 million tonnes, which is down 15% from market 2014-15. This is due to a reduction in main-crop and off-season crop rice production due to drought in the northern region and central plains.
The forecast of rice exports in 2015 remains unchanged at 9 million tonnes, down 18% from 2014. According to the Thai Custom Department, rice exports from January–September 2015 totaled 6.6 million tonnes, down 13% from the same period in 2014. This was mainly due to increased competition from Vietnam and India. Parboiled rice exports declined to around 1.7 million tonnes, down 30% from the same period in 2014. Also, white rice export fell to 3.5 million tonnes, down 7% from the same period in 2014.
In the last quarter of 2015, monthly rice exports are expected to increase to 750,000–800,000 tonnes, compared to an average of 735,000 tonnes per month in the first nine months of 2015. This will be driven by the shipments of new-crop white rice under the government-to-government agreements with the Philippines and China. Also, Thai white rice is becoming more competitive as the price difference with Vietnam is currently smaller than earlier in the year.