Thai Prime Minister Yingluck Shinawatra''s policy to purchase rice from farmers for 50% more than the market price has affected the competitiveness of Thai exports and has increased the amount of unsold rice stocks. The policy, aimed at increasing farmer''s income, has threatened Thailand''s status as the top rice exporter, with rice exports expected to almost halve in 2012. Experts believe that Thailand may flood the world rice market if it abandons the policy now.
The US Department of Agriculture (USDA) has predicted Thailand''s global share to drop to less than one-fifth to around 6.5mn tonnes in 2012. The country produces an average of around 20mn tonnes of rice each year, of which half is normally exported. The USDA has forecast the country''s unsold stocks to be around 9.4mn tonnes in 2012 and 12.1mn tonnes in 2013.
