Thai rice prices (white 100% class B) reached the highest level since August 2013 this week, at $507 per metric tonnes, following drought conditions in Thailand which continues to raise concerns about supply shortages. According to the USDA, Thai rice production is estimated at 18.5 million tonnes in 2019/20, a drop of 9% y-o-y. Thai rice prices experienced a bullish trend since the third quarter of 2019, when worries started to increase over drought concerns coupled with a strong currency.
The high Thai rice prices have encouraged buyers to search for alternative suppliers, leading to lower foreign demand. As a result, Thailand’s 2019/20 rice exports are estimated at 7.5 million tonnes – the lowest since 2013/14.
On the other hand, Vietnamese rice exports are projected at 7 million tonnes, up 6.3% y-o-y in 2019/20. Vietnamese rice prices continue to rise, supported by strong foreign demand due to competitive prices compared to Thailand. Additionally, domestic demand has strengthened since the coronavirus outbreak, as buyers are increasingly stockpiling in anticipation of further spread.