Bangkok, Apr. 29 - Thailand, the world's biggest rice exporter, faces no shortage of the staple grain, even as its price has soared on global markets, the head of the country's rice exporter association said Tuesday.
Limits imposed by some U.S. stores on rice purchases has more to do with "panic" among consumers than any supply shortages in Thailand, said Chookiat Ophaswongse, president of the Rice Exporters Association.
"There is no shortage of rice," Chookiat said. "People are a bit panicked by getting news of this food crisis all over the world. Everybody starts stocking rice. Instead of buying one or two bags, they buy 10."
Last week, the two biggest U.S. warehouse retail chains limited how much rice customers can buy because of what Sam's Club, a division of Wal-Mart Stores Inc., called "recent supply and demand trends." Seattle-based Costco Wholesale Corp. (COST) also put limits on bulk rice purchases at at least some stores.
Global rice prices have risen sharply this year amid global food inflation, growing demand and poor weather in some rice-producing countries. Some Asian countries, including India and Vietnam, have curbed rice exports to guarantee their own supplies.
Prices of Thai rice for export - considered a regional benchmark - have tripled since December to about $1,000 a ton.
On Monday, Commerce Minister Mingkwan Saengsuwan also said Thailand isn't suffering a rice shortage and will continue to export the grain.
Thailand has seen its overseas sales of rice jump 67% in the first four months of 2008 partly due to export restrictions in India and Vietnam. White rice exports have soared 184% while high end jasmine rice is up almost 23%.
"The buyers who usually buy from Indian have switched to Thailand," Chookiat said. "That is why we have been shipping a million tons a month in the past six months."
Thailand, unlike other major exporters, hasn't enacted any measures to limit exports. But if exports exceed 11 million or 12 million tons this year, Chookiat warned the government could take action to slow sales to ensure there is adequate domestic supplies.
"The government is not imposing anything yet," Chookiat said. "But they said they will keep monitoring export figures."
Mingkwan, the commerce minister, said the country is on target to ship 9 million tons of rice overseas in 2008.
Meanwhile Tuesday, the Thai Cabinet approved a plan to dip into the government's rice stockpile of 2.1 million tons to help keep domestic prices low.
Prime Minister Samak Sundaravej said it will start selling five-kilogram bags of rice at 170 baht ($5.37) each, compared to the current domestic price of around THB200 baht.
"We will start in about two weeks," Samak said, but without specifying how much of the country's stockpile would be sold to consumers. He also did not comment on who would qualify for the subsidized price.
Traders said the announcement did not affect rice prices.
Samak said the government would buy rice from farmers to refill the stockpile.
"This should help bring down the overall market price for consumers," he said.
The government purchases rice for its reserves of rice in order to help sustain prices when they are low.