Thailand''s white rice exports last year dropped sharply by 43% year-on-year to 2.37 million tonnes, while Vietnam''s exports of the same rice rose by 27% to 5.33 million tonnes.
Vietnam''s shipments were made to major markets that previously purchased large volumes of rice from Thailand, such as Malaysia, Singapore, and the Philippines.
The strong sales in January, when Vietnam''s rice exports grew by 20%, ensure that the country will most likely meet its rice export projection of 6 million tonnes.
"Shouldn''t we stop blaming one another for the current paddy price falls and start considering how we could compete effectively with Vietnam?" questioned Sopan Manathanya, director of the Thai Rice Exporters Association, at the meeting among farmers, millers, and exporters in Suphan Buri last week, where falling prices was among the hot topics.
Vietnam''s devaluation of the dong by 5% against the US dollar last November and 3.4% in February is expected to strengthen the competitiveness of its rice exports.
Last week, the price quotes for Vietnamese rice were much lower than those of Thai rice, by more than US$100 per tonne for low-grade or 25% white rice, and $130 a tonne for premium types.
The meeting viewed that a new venture, Cambodia-Vietnam Foods Co, would beef up Vietnam''s rice trade. Established with an initial cost of $8 million by Investment and Development Joint Stock Co (IDCC), Vinafood and Green Trade Co of Cambodia, the company operates a fully integrated rice business, from production and processing to exporting.
Furthermore, the Vietnam Food Association''s plan to set up a $6-million fund to improve its rice quality could threaten future Thai exports.
Many exporters have urged the Thai government to sell some lower-priced rice from state stockpiles to foreign markets so that it can compete with Vietnam''s products.
But some have encouraged the industry to focus on better-grade rice, such as Hom Mali fragrant rice, to avoid fierce competition.
Korbsook Iamsuri, president of the association, said that the brown planthoppers and droughts are unlikely to deter plans to export 9-10 million tonnes of rice this year but the falling purchasing power of some countries could.
"Some African countries that have bought parboiled rice from us could turn to lower-priced grains, especially wheat and corn, and once they are accustomed to the taste, we might lose these markets," she said.
Ms Korbsook said Thailand has already lost market share in Malaysia and Singapore as buyers have shifted to lower-priced products.
Despite intense competition from Vietnam, she is confident the Thai exports will meet the projection, driven by rising global trade estimated at 437.12 million tonnes, up from 434.94 million tonnes last year. Thailand exported 8.57 million tonnes of rice worth 170 billion baht last year.
