Page 25 - FoodFocusThailand No.203 February 2023

SPECIAL REPORT
SPECIAL REPORT
Thailand’s

Agro-Industrial

Product Export

Situation in 2023

The Siam Commercial Bank’s Economic Intelligence Rice industry
Center (SCB EIC) has predicted that the agro- The rice industry is expanding as rice yields increase and India’s
rice export control policy helps boost Thailand’s exports and prices.
industrial product situation in Thailand in 2023 will be Thailand’s rice production volume is expected to be 34.2 million
in a K-shape, indicating unequal economic recovery tons, a 1.8% increase in accordance with the increasing harvest
across industries, in contrast with the market in area and per-rai yield as water is sufficient for rice cultivation. The
export price of Thai rice in 2023 is estimated to increase by 14.4%
2022, which saw the expansion of all industries. It (YoY) due to the dwindling global rice stock and India’s rice export
is estimated that in 2023, the sugar, tapioca, and control policy. Thailand’s rice exports are expected to increase
rice industries will remain in continuous growth while by 25.8% (YoY) in 2023, in accordance with the projected rice
exporting volume of 8.6 million tons, a 10.3% increase (YoY)
the oil palm industry will be shrinking. owing to factors such as 1) improved pricing as a result of India’s
rice export controls and 2) increasing Thai rice production.
Sugar industry However, the rice industry still faces significant challenges from
Despite the falling world price of sugar in 2023, Thailand’s India’s policy changes, extreme weather conditions, and higher
sugar industry remains growing, as evidenced by rising production costs. In the medium-term, the rice industry is still
production and market value. Thailand’s sugar production continuously expanding, in response to rising rice prices and
tends to increase by 15.7% to 11.8 million tons in accordance increased production due to India’s rice export control policy.
with the processed sugar cane quantity, which also increases
by 15.8% (YoY) to 106.6 million tons due to the increased Oil palm industry
harvest area and per-rai yield from sufficient rainfall that In 2023, the oil palm industry tends to shrink because of falling
crude palm oil prices, lower demand, and slower production
simulates the growth of sugarcane. It is predicted that growth. Nevertheless, the price of crude palm oil is higher than
Thailand’s sugar exports in 2023 will rise by 9.2%. the average over the last seven years. According to EIC,
Nevertheless, the sugar industry remains vulnerable to the production of oil palm in 2023 will be at 17.8 million tons, a 2.3%
global economic situation, such as India’s sugar export increase (YoY) in accordance with the expanding harvest area
restrictions, extreme weather conditions, and consumers’ and per-rai yield. On the other hand, the crude palm oil price in
blooming health consciousness. In the medium-term, the 2023 will be at 32.3 baht per kilogram, a 25.8% decrease (YoY)
sugar industry will continue to grow as Thailand’s sugar due to the alleviating labor shortage in Malaysia. Because of the
production and world sugar demand are estimated to rise lower price of crude palm oil, the price of fresh oil palm will also
steadily. fall by 26.8% to 5.5 baht per kilogram. In 2023, it is estimated that
Tapioca industry Thailand’s crude palm oil demand will drop by 3.7%, owing
primarily to lower exports as well as increased competition from
The tapioca industry is constantly expanding, as demonstrated Malaysia and Indonesia. Meanwhile, domestic consumption is
by increases in yield, export, and price, which have risen due estimated to rise according to Thailand’s economic recovery and
to rising demand from a major trading partner like China. In the adjustment of the biodiesel formula from B5 to B7. However,
2023, tapioca yield is expected to be 36.1 million tons, or a extreme weather conditions and the export policies of major
4.1% increase (YoY) as the per-rai yield and harvest area competitors like Indonesia continue to be major risk factors for
increase. The price of fresh tapioca is estimated to be 2.56 the industry. Despite the declining price, the oil palm industry
baht per kilogram, a 1.6% increase (YoY) as demand from remains stable in the medium-term, with both production and
trading partners remains strong, and corn prices in China rise. demand expanding continuously.
In 2023, it is estimated that Thailand’s tapioca export value According to the EIC, agro-industry entrepreneurs must
will increase by 5.7% (YoY) in accordance with the export expedite their adaptability to handle such a challenge and boost
value of tapioca chips (shredded), raw tapioca flour, and their competitive potential in the global market. Planning for
modified starch, due to supporting factors like: 1) a large price economic uncertainties, international rules and barriers, changes
difference between Chinese corns and Thai tapioca chips, in the policies of trading partners or competitors, as well as
resulting in China’s greater demand for Thai tapioca chips as additional investment to capitalize on new opportunities and
they are a cheaper ingredient for alcohol production compared mitigate the effects of adverse weather and sustainability, are just
with corns. 2) trading partners’ expanding economies. But a few examples.
even so, the industry still faces significant challenges from
the trading partners’ economic uncertainties, China’s changing
policy, the reemergence of cassava mosaic disease, and
extreme weather conditions. However, in the medium-term, More Information Service Info C002
the tapioca industry will benefit from rising demand for tapioca-
based products and Thailand’s increased production. FEB 2023 FOOD FOCUS THAILAND 25

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