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December 26, 2008
 
Thai Shrimp Weekly: Holiday spending spree boosts price rally (week ended Dec 24, 2008)              
 
An eFeedLink Exclusive
 
       
Price summary
 
Driven by the year-end holiday buying spree, Thai shrimp prices continue to rally, going up by as much as THB12/kg this week in the buying guide issued by the Thai Frozen Foods Association, whose members control about 70 percent of the country's shrimp exports.
 
In open trading in Mahachai, Thailand's main wholesale shrimp market, the price hike was moderate - THB5/kg at the most - compared to last week's THB12/kg.
 
In what appears to be the end of months of price depression, prices have steadily gone up in both markets since the start of the month.
 
 
Market analysis
 
Mahachai traders said sales have been brisk during the past few weeks in the run-up to the Christmas and New Year's Day holidays. Despite the economic downturn, Thailand's central bank says consumer spending has begun to perk up due to a number of factors, including low interest rates, declining oil prices, and accelerated government spending.
 
The export situation, however, is not as positive. Shipment to the US, the country's main shrimp buyer, had contracted by 3.38 percent during the first nine months of 2008 owing to its current financial troubles.
  
Siripol Yodmuangcharoen, Permanent Secretary for Commerce, said the world economic crisis had forced the United States and other principal importers of Thai goods to reduce their imports.
 
Aggravated by its own political problems, especially the shutdown by antigovernment protesters of Bangkok's Suvarnabhumi and Don Mueang airports from November 25 to December 3, Thailand's exports last month declined by 18.6 per cent to about US$11.9 billion.
 
Exports of agricultural products and food products dropped significantly, he said, although actual figures have yet to be released. He added that there are signs that exports in December would continue to retreat.
 
With export demand expected to contract, shrimp farmers have announced a voluntary production cutback by as much as 20 percent next year. The Thai Shrimp Association projects next year's production at 392,000 tonnes, down from the 530,000 tonnes produced in 2007 and 500,000 tonnes in 2006.
 
Last year, the country's shrimp farmers adopted the same strategy to rein in falling prices. This resulted in a 7.5 percent drop in output for 2008 estimated at 490,000 tonnes.
 

White shrimp prices (in Thai baht) at Thailand's main markets

Unit of Measure: Thai Bhat

Shrimp size

Mahachai seafood market

Thai frozen foods association
benchmark price

Bangkok markets

 

Dec 17

Dec 24

Dec 17

Dec 24

Dec 17

Dec 24

40 pcs/kg

 

 

125

135

 

 

50 pcs/kg

125

128

115

125

150-165

170-180

60 pcs/kg

116

120

105

117

140-150

155-165

70 pcs/kg

110

115

100

112

120-130

140-150

80 pcs/kg

100

102

95

105

110-120

125-135

90 pcs/kg

90

92

90

 

100-110

115-125

100 pcs/kg

85

85

 

 

90-100

100-110

Note: Farm-gate prices are THB10-15 lower than those at Mahachai market.
US$1=THB 35.015 (Dec 26)
 


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