September 19, 2008

Corn exports from Thailand are likely to drop more than 50 percent in September to around 30,000 tonnes from the previous month due to slowing demand after India eased export regulations.

"Buyers are on the sidelines as they are well stocked because they bought a lot of corn in previous months, mostly from India," said a trader at one of Thailand's top corn exporting firms.

Thailand exported around 10,000 tonnes of corn from September 1-15, down from 80,000 tonnes in the whole of August and around 100,000 tonnes in July.

Thailand is a relatively small corn exporter, shipping around 300,000-500,000 tonnes a year, just 0.3-0.5 percent of the global trade of 100 million tonnes.

However, it emerged as a key supplier to neighboring Malaysia and other countries in Southeast Asia region after India imposed a ban on exports of grain in July.

Thai corn prices have fallen by around a quarter to US$260/tonne, free on board, from US$350/tonne quoted in July.

CBOT December corn rose 1-½ cents to US$5.33 per bushel on Wednesday in choppy trade, buoyed by strong crude oil and gold.

Domestic corn prices fell to 8.5 baht/kg, from 12.5 baht in August, traders said.

Thailand was forecast to produce 3.7 million tonnes of corn in 2008, up slightly from 3.6 million tonnes in 2007.

(US$1=34.145 baht)