Chart, export of rice : values and quantities until february 2009

Here is an update of the chart “Rice crisis” I’ve created last year, when we had the peak of inflation and serious problems of offer/demand in the world.

Now with the big crunch of exports, particularily in the industrial sector, agriculture is coming back under the spot lights.

Some people think “self sufficiency” and foresee a rozy future for Thailand.

Yes agriculture is a good card for the country… But let’s not forget some serious drawbacks :

-productivity is low… many people are working in the fields… It would be possible to achieve higher productivity but… employment would take a serious hit. What all those people without job would do ?

-prices are volatile. Even though we can assume they will remain high (demand is increasing… following the increase of world population), and new shortages could happen again (if other rice producting countries reduce their own exports because natural disaster etc.).

-If money is to be made from the rice business… it’s not really on the farmers side. Same old story… Companies, middle men take a large chunk of profits.

-Rice is political, highly political, therefore can be riddled with problems : indeed, the government is buying large quantities of rice… at higher prices than market prices. It’s a subsidy. Therefore it costs.

ricefeb09

The “bubble” last year is clearly visible, and the peak at 1,2 million metric tons (june) is linked to the “Peak Exports” (july 2008).

In february 2009, the quantity was 690 000 metric tons, in the average.

Watch out : prices are in current US dollars (1 USD in 2009 is worth less than 1 USD in 2005). And we had inflation in Thailand too.

(source Bank Of Thailand, table EC_XT_009)

4 Responses to “Chart, export of rice : values and quantities until february 2009”


  1. 1 observer 4 April 2009 at 12:29 pm

    The Bangkok Post shows (like many times) some megalomania together with finance minister Korn in the todays issue:

    ” GOVERNMENT TO INCREASE BORROWING”

    The article finishes with KORN´S statement: “HIS (MY) IDEAS AND OTHER ECONOMIC MINISTERS FROM G20 COUUNTRIES WERE COMPATIBLE ON THE ISSUE OF REVIVING THE ECONOMY”

    He apperently think that he inflenced the top gang of the world politicians with the thai government´s weired ideas.
    What a clown!

  2. 2 Lloyd 4 April 2009 at 1:04 pm

    Thailand needs to think long and hard about what direction its agricultural industries will head, with very little research and development into sustainable farming taking place in Thailand it could within the not so distant future find itself importing the commodities it now exports.

    Myanmar, Loas and Cambodia have welcomed foreign nationals into their farming sector although at this stage it is in a manner that is seeing very little return for the displaced citizens and plenty in the deep pockets of the politicians and middleman. If pressure is brought to bear on these foreign nationals to clean up their act then these counries could benefit in ways the Thais will only dream about.

  3. 3 George P Tuckeer 5 April 2009 at 3:21 am

    TC,

    This is off-topic, but you might be interested in this because what happens in Japan has a fair bit of impact in Thailand where japanese multinationals are major investors:

    Was Japan’s seemingly strong recovery of 2003-07 an illusion? And why has the global crisis hit Japan much harder than other rich economies?: http://www.economist.com/finance/displayStory.cfm?story_id=13415153&fsrc=nwlbtwfree

    cheers.

  4. 4 World Insanity 5 April 2009 at 7:34 am

    George:

    This article may also prove of interest (TC will love the charts!):

    U.S. Heading for Japan Style Two Decade Economic Depression

    http://www.marketoracle.co.uk/Article8541.html


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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.


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