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December 14, 2011

Thai Feed Weekly:  Price of broken rice recovers on strong export demand (week ended on Dec 5)
 
An eFeedLink Exclusive
 
 
Price Summary
 
Except for broken rice, which has jumped by US$25/tonne to US$581/tonne, prices of other feed raw materials remain stable despite an anticipated increase in demand as feed plants in Thailand's flood-hit provinces resume normal operations.
 
Last week, the price of broken rice, along with other rice by-products, dropped by about 10% as rice farmers started to salvage crops damaged by the month-long flooding. The Office of Agricultural Economics reported that tonnes of soaked rice gathered from flood-damaged rice fields were being dried and milled into broken rice for feed use.
 
 
Market analysis
 
Temporary oversupply brought prices down that week but increased overseas orders, especially from China, allowed the price of broken rice to quickly rebound. Like Thailand, China uses broken rice in animal feed formulation. However, prices of other rice products like rice bran and like bran residue are unchanged.
 
The sudden surge in the price of Thai broken rice worries local rice exporters, however. They fear they could lose their market to Vietnam where broken rice currently trades at only US$515-$525 a tonne. Threatening Thailand's position as the world's number one exporter, Vietnam recently shipped 300,000 tonnes of broken rice to Indonesia.
 
Industry sources say that as a temporary measure, exporters are thinking of importing broken rice from Pakistan, where it sells for only US$450/tonne FOB, and re-export them to other countries such as China.  
 
The plan, however, may require approval from the Commerce Ministry which restricts import of broken rice to food processors.
 
The Thai feed industry has been asking the government to rescind the restriction so it could import broken rice from neighbouring countries, where they are cheaper, to cut feed production costs - to no avail. The government feels allowing feed makers to import broken rice freely could undermine local prices to the detriment of Thai rice farmers.
 

 

PRICE as of  Nov 28
(in Thai baht/kg)

PRICE as of  Dec 5
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Corn (Delivered to feed factory)

9.90-10.10

9.90-10.10

--

Cassava

2.45-3.00

2.45-3.00

--

White Broken Rice A.1 Super (US$/tonne)

556.00

581.00

25.00

White rice bran

9.80-10.00

9.80-10.00

--

Rice bran residue 

8.40-8.50

8.40-8.50

--

Soy

11.60-14.45

11.60-14.45

--

Soymeal (imported)

15.50

15.50

--

Soymeal (local)

15.05-15.30

15.05-15.30

--

Fishmeal (shrimp grade)

25.00-37.98

25.00-37.98

--

US$1=THB 31.25 (Dec 14, 2011)

 

 


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