PHUSADEE ARUNMAS
Bangkok Post
The idea of Thailand forming a rice price-fixing cartel with four other Mekong countries would be hard to implement, as rice is a politically sensitive commodity and production is relatively hard to control, according to rice exporters.
"We view the idea as impractical - it is impossible to fix rice prices," said Chookiat Ophaswongse, president of the Rice Exporters Association. "Rice is definitely different from oil because it is a sensitive product. In addition, it couldn't be kept as long."
Mr Chookiat said prices could not be set at will if any of the member countries failed to control output.
Encouraged by runaway prices of the grain in recent months, Prime Minister Samak Sundaravej on Wednesday revived the idea first floated by Bangkok in 2001 to set up a rice cartel comprising Thailand, Vietnam, Laos, Burma and Cambodia.
The group would be modelled on the oil cartel Opec, and would be called the Organisation of Rice Exporting Countries (Orec).
The idea was agreed on in principle by the five countries but has yet to take shape, according to Mr Samak.
Thailand first floated the idea out of fear of losing its market share because its export price at the time was $40 a tonne higher than those of Vietnam, India and Pakistan.
But Mr Chookiat said regional co-operation should instead be directed at improving productivity, reducing costs and strengthening logistics networks.
"Actually, Thailand has a strength in terms of know-how and can help its neighbours improve their production efficiencies and rice varieties. But we are not sure whether the other countries need our help."
According to Mr Chookiat, joint ventures in rice farming, particularly on a large scale, should also be promoted among investors in Thailand and the other countries.
Thailand is the world's largest rice exporter, shipping an estimated 9.5 million tonnes of rice overseas last year.
World rice prices have soared this year, blamed on higher energy and fertiliser costs, greater global demand, droughts, the loss of rice land to biofuel plantations, and price speculation.
International demand for Thai rice has soared after two other top exporters, Vietnam and India, imposed limits on exports to secure domestic supplies.
Statistics released yesterday showed that rice export volume from Thailand rose 36% in the first four months of the year.
Shipments totalled 4.1 million tonnes from January to April, compared with three million in the same period last year, said Apiradi Tantraporn, director general of the Foreign Trade Department. April exports were 814,218 tonnes, below the monthly average of 1.1 million tonnes in the first three months.
"Prices are close to a peak," Mrs Apiradi said. "Global demand for our rice is strong."
Thailand may supply 45% of the world's rice exports this year, compared with 31% last year, she said.
Mrs Apiradi also said the Thai government was unlikely to participate in the new rice tender by the Philippine government, as it had no policy to sell rice through the government channel.
The Philippines is seeking 675,000 tonnes of rice in a tender on May 5 after failing to attract a sufficient amount in previous auctions.
Mrs Apiradi said authorities would rather help lead the private sector to negotiate with buying countries.
She said several countries had contacted Thailand to buy rice, including Timor, Sri Lanka, Liberia and Nigeria.
"We view the idea as impractical - it is impossible to fix rice prices," said Chookiat Ophaswongse, president of the Rice Exporters Association. "Rice is definitely different from oil because it is a sensitive product. In addition, it couldn't be kept as long."
Mr Chookiat said prices could not be set at will if any of the member countries failed to control output.
Encouraged by runaway prices of the grain in recent months, Prime Minister Samak Sundaravej on Wednesday revived the idea first floated by Bangkok in 2001 to set up a rice cartel comprising Thailand, Vietnam, Laos, Burma and Cambodia.
The group would be modelled on the oil cartel Opec, and would be called the Organisation of Rice Exporting Countries (Orec).
The idea was agreed on in principle by the five countries but has yet to take shape, according to Mr Samak.
Thailand first floated the idea out of fear of losing its market share because its export price at the time was $40 a tonne higher than those of Vietnam, India and Pakistan.
But Mr Chookiat said regional co-operation should instead be directed at improving productivity, reducing costs and strengthening logistics networks.
"Actually, Thailand has a strength in terms of know-how and can help its neighbours improve their production efficiencies and rice varieties. But we are not sure whether the other countries need our help."
According to Mr Chookiat, joint ventures in rice farming, particularly on a large scale, should also be promoted among investors in Thailand and the other countries.
Thailand is the world's largest rice exporter, shipping an estimated 9.5 million tonnes of rice overseas last year.
World rice prices have soared this year, blamed on higher energy and fertiliser costs, greater global demand, droughts, the loss of rice land to biofuel plantations, and price speculation.
International demand for Thai rice has soared after two other top exporters, Vietnam and India, imposed limits on exports to secure domestic supplies.
Statistics released yesterday showed that rice export volume from Thailand rose 36% in the first four months of the year.
Shipments totalled 4.1 million tonnes from January to April, compared with three million in the same period last year, said Apiradi Tantraporn, director general of the Foreign Trade Department. April exports were 814,218 tonnes, below the monthly average of 1.1 million tonnes in the first three months.
"Prices are close to a peak," Mrs Apiradi said. "Global demand for our rice is strong."
Thailand may supply 45% of the world's rice exports this year, compared with 31% last year, she said.
Mrs Apiradi also said the Thai government was unlikely to participate in the new rice tender by the Philippine government, as it had no policy to sell rice through the government channel.
The Philippines is seeking 675,000 tonnes of rice in a tender on May 5 after failing to attract a sufficient amount in previous auctions.
Mrs Apiradi said authorities would rather help lead the private sector to negotiate with buying countries.
She said several countries had contacted Thailand to buy rice, including Timor, Sri Lanka, Liberia and Nigeria.
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