May 3, 2010
Thai agriculture exports to grow slightly
Despite flourishing growth in farm and food exports in the first quarter, exports of agricultural products are expected to grow only slightly throughout the rest of the year, due to many negative factors.
Among these, exporters list global warming, the strengthening baht, the ongoing political chaos and rising non-tariff barriers. They warn export volumes will deteriorate in the current quarter and the second half of the year.
First quarter food exports jumped a huge 24.2% year on year to a value of THB205 billion, thanks to the global economic recovery.
However, Pornsilp Patcharintanakul, chairman of the Board of Trade''s Food and Agriculture Committee, warned food exports could actually decline, because of lowerthanexpected production.
"The country''s exports could be lower than our target because of these negative factors. On the other hand, the same negative factors could also benefit the country if they hit other countries while Thailand maintains its competitiveness to supply commodities to the world market," Pornsilp said.
Rising oil prices could also benefit the value and volume of Thailand''s food exports this year, because many countries will turn more from food crops to fuel crops, he said.
To ensure continued exports of Thai food, Pornsilp said both the government and private enterprises should urgently raise their food standards to avoid non-tariff barriers, which are being increasingly imposed by importing countries. Without attention to standards, Thai foods will be subject to import barriers designed to protect foreign markets.
The National Food Institute (NFI) predicts food exports will grow 10% to THB830 billion this year, from last year''s value of THB754 billion. Thailand advanced to being the world''s 12th largest food supplier last year and Asia''s second largest food exporter after China.
Thai food enjoyed a 2.47% share of the global market last year.
NFI vice president Amorn Ngammongkolrat said food output in the second quarter was expected to grow 6.3% to a value of THB202 billion. This would be much lower than the first quarter''s growth, because of drought in many provinces.
Food exports should grow 7% to THB210 billion in the third quarter and 4.9% to THB213 billion in the fourth quarter.
The chairman of the Federation of Thai Industries'' Food Processing Industry Club, Visit Limprana, said the ongoing political turmoil would hamper exports in the second half of the year, because a smaller number of importers were coming to Thailand''s trade fairs.
Meanwhile, this year''s cassava production is expected to drop from 27 million tonnes to 20 million tonnes. It will tumble further, to about 15 million tonnes next year, because the infestation cannot be easily remedied, he said.
The price of cassava is now the highest ever recorded, peaking at THB3 a kilogramme. Prices that are too high can pose future problems for Thai cassava growers, because foreign processors can substitute other cereal crops for cassava, Seree added.