June 17, 2013

Corn imports from Laos may hurt next Thai corn crop (week ended June 10)
 
An eFeedLink Exclusive
 
 
Price Summary
 
Corn prices are higher this week due to lower corn supply, even though prices are expected to fall in the long run due to the import of corn from neighbouring countries such as Cambodia, as a result of the cabinet extending import permission period to August 2013.
 
Corn is traded at THB 10.20/kg (US$0.33) this week, an increase from THB 9.90/kg (US$0.32/kg) last week.
 
Loss due to the paddy rice pledge scheme is expected at THB 260,000 million or US$ 8,470 million, according to the deputy minister of finance, but this is still denied by Ministry of Commerce. The government has released more paddy rice to rice mills,  which brought down prices of rice by-products such as broken rice, white rice bran and rice bran residue to THB 15.10/kg (US$ 0.49/kg), THB9.50/kg (US$0.31/kg), THB 8.90/kg (US$0.30/kg) respectively this week.
 
 
Market analysis
 
According to the Cabinet's resolution since January 2013, Thailand is permitted to import 200,000 tonnes of corn from Laos for re-export to a third country. Recently in May, big batches of exports have been rejected by Vietnam due to the low quality, resulting in increased inventory of corn from Laos, which may affect new crop price. As such, the cabinet may initiate corn price intervention for 2012/2013.
 
On June 4 this year, the Thai cabinet approved the extension of the permitted period of feed corn import from Cambodia from July 31 to August 31, 2013. This is in response to the request from the Cambodia Ministry of Commerce to help Cambodian corn farmers for their first crop that will enter the market around June each year. New permission period will be set for the new period next year.
    
The current lack of corn genetics and higher prices in Nakornsawan, together with a lack of rain, may delay the new corn crop in the central region. Nakornsawan is the main province of corn cultivation area in the central region.
 
Around 90% of soybean consumption in Thailand is imported, the majority from the United State, Argentina and Brazil. USDA reported that US soybean cultivated area for 2012/2013 will be 77.1 million acres, at a capacity 44.5 bushel/acre with total production of 3.39 billion bushel this season. Major importers such as China will import more than last season, from 59 million tonnes last season to 69 million tonnes this season.
 

 

PRICE as of  Jun 3
(in Thai baht/kg)

PRICE as of  Jun 10
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Corn 

9.90

10.20

0.30

Cassava roots

2.23

2.20

-0.03

White Broken Rice A.1 Super(USD/tonne)

526.00

516.00

-10.00

White rice bran

10.30

9.50

-0.80

Rice bran residue 

9.10

8.90

-0.20

Soybean 

20.00

19.60

 -0.40

Soybean meal 

18.40

17.20

 -1.20

Fishmeal (protein more than 60%)

24.30

24.30

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US$1=THB 30.70 (Jun 17, 2013)

 

 


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