May 3, 2004

Thailand Approves Duty-Free Corn Imports
 
The Thai cabinet has removed the usual 20% tariff for up to 500,000 metric tons of corn to be imported by mid-July, to alleviate surging corn prices in the domestic market, a Bangkok-based industry official said Monday.
 
"We were informed Friday about this decision by the cabinet," said the official with a major buying group.
 
Domestic corn prices rose to a 20-year-high of 7.50 baht ($1=THB39.600) a kilogram last week, according to the Swine Raisers Association of Thailand.
 
Substantial corn exports to neighboring countries, decreasing stocks, and an anticipated revival of feed demand, which could cause a shortage in the months before new crops hit the local market, contributed to the price hike.
 
Poultry and swine raisers use corn in feed mixes, with 55%-60% of chicken feed made from corn.
 
Thai swine farmers had asked the government to either delay corn exports or temporarily remove the import tax on corn to help lower corn prices.
 
Some industry watchers, however, doubt that Thailand will need to import half a million tons of corn by mid-July, mainly because poultry exports haven't recovered after a bird-flu outbreak in January.
 
Thailand is the world's fourth largest poultry exporter after the U.S., Brazil and China. Chicken production in the country dipped as low as 40%-50% of normal levels when the outbreak was at its peak, according to the Thai Ministry of Agriculture and Cooperatives.
 
Thai government officials weren't available for comment due to a national holiday Monday.