Thailand closes US maize deal for September-October delivery at reference price of B8.99/kg
Thailand’s planned US maize imports for September-October have drawn strong opposition from traders, who warn they will depress domestic maize prices during harvest. They criticised factory buying practices, GMO import policy, ineffective price guarantees and urged the government to better protect local farmers.
A source in the field-crop trading industry told Thansettakij that global agricultural market reports for July 16-17 showed Thailand had ordered maize from the United States for shipment during September-October, with gradual delivery scheduled in the fourth quarter of this year.
Although the official transaction price has not been disclosed, the CFR Asia replacement level as of July 16 stood at US$267.43 per tonne, or around 8.99 baht per kilogramme, based on an exchange rate of 33.65 baht per US dollar.
As the issue of US maize imports comes under close scrutiny, Terdsak Lapjitrakosol, president of the Thai Field Crops Trade Association, said allowing US maize imports at this time was a major mistake by the state because it directly affects domestic feed maize farmers.
He said the market had shown unusual signs in July, after several major operators announced they would stop buying maize and close all factories, citing the low season or factory maintenance. This left many farmers unable to release their produce, while raising concern that foreign maize imports would further pressure domestic maize prices.
Terdsak said that in more than 50 years in the industry, he had never seen factories close in this manner. However, he said tactics to push down prices often appeared when farmers were about to deliver produce, such as reducing purchase quotas from 10 truckloads a day to just five, forcing delays until prices fell to their lowest point.
“When we do not sell, they accuse us of hoarding goods. They say it all by themselves. Middlemen like us support farmers from providing seeds to basic processing so villagers can survive. But if the government continues to allow this kind of mismanagement, Thai farmers will certainly not survive. Even cattle farmers are now having to sell off their cattle because they cannot afford feed costs,” he said.
Another highly questioned issue, he said, was the inconsistency of ministry and government policy: Thai farmers are not allowed to grow GMO maize, yet the country allows imported GMO maize to enter the kingdom.
“If we are not allowed to grow it but others are allowed to import it, what does that mean? The claim of shortages is only an excuse to buy cheap goods without sympathy for farmers. If this is how it will be, then allow us to grow GMO maize and end the matter. Then we will not have to keep arguing,” he said.
On the price-guarantee scheme of 9.80 baht per kilogramme, Terdsak said it had never happened in practice. Last year, farmers actually sold at only 9.20 baht per kilogramme.
He added that grading also lacked clear standards. Factories often downgraded Thai maize to grades 3, 4 or 5 in order to cut purchase prices. By contrast, imported DDGS, or distillers dried grains with solubles, a by-product of ethanol production, was accepted by factories despite problems such as weevils or lower quality.
Thai farmers are now facing higher costs due to the use of harvesting machines, which leave maize with moisture levels of up to 30%. Price pressure and foreign imports during September-October, Thailand’s harvest season, would further worsen the situation, he said.
Terdsak concluded: “I have seen policies like this for more than 10 years, and they are getting harsher every day. Now I can no longer accept it. I am thinking of resigning as association president because I no longer know how to help villagers when the government refuses to listen to the truth and continues to allow maize imports from outside to destroy the livelihoods of Thai people.”
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Source : Nation Thailand
