Futures Market News
Delayed rains, possible floods threaten Thai rice crop
Jun 23, 2010 03:36 PM
Thailand's main rice crop may decline by as much as 10 percent next season as erratic weather could hurt crops. Bloomberg News covered a report by the Thai Rice Mills association, which said the government had warned farmers to postpone their planting because the crop could be damaged by delayed rains followed by heavy flooding.
The association's vice president, Banjong Tungjitwattanakun, said that
"farmers will suffer from the double impact of drought and flood. Drought already damaged 38 percent of the current crop, lowering output to 5 million tons from 8 million estimated earlier."
Banjong also told Bloomberg that production could fall even lower if farmers decide to plant more-profitable crops in place of rice. He said the price of Thai 100 percent grade-B white rice could rise to $500 per ton.
On the Chicago Mercantile Exchange, the price of rough rice futures for September delivery fell a tenth of a percent to $10.74 per hundred pounds.
The change in weather has been blamed on the El Niño weather pattern, which affects winds and currents over the Pacific and has an impact on weather around the globe.
Rice is a staple product across much of Asia and Latin America, and Thailand is the largest exporter of rice in the world, supplying many of its neighbors.
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