Costlier Thai grains have limited the Thai rice exporter to ship just 10 million tonnes of rice a year against the forecasted quantity by Commerce Ministry and USDA, said Charoen Laothammatas, president of the Thai Rice Exporters Association.

The TREA expects export to be worth of US$5.95 billion or 161 billion baht in 2015.10 million shipment quantity includes 5 million tonnes of white rice, 2 million tonnes of Hom Mali fragrant rice, 2.7 million tonnes of parboiled rice, 100,000 tonnes of glutinous rice and 200,000 tonnes of Pathumthani fragrant rice.

USDA estimated Thailand to export 11.3 million tones of thai rice this year but Commerce Ministry said that they would ship as much as 11 million tones thai rice this year.

Thai rice export has raised in 2014 by 66% from 2013 and Export value rose by 23% to $5.43 billion.Mr Charoen marked 2015 as a challenging year as this year Thai rice prices are quoted as highest in the region.

For instance, key rival Vietnam’s free-on-board price for 5% white rice is $350-360 a tonne, compared with Thai grains quoted at $405-410.

Last year, Thai rice prices were $20-30 cheaper than those of Vietnam.

“This year, Thailand is expected to see stiffer competition, while the government’s massive rice stocks and volatile foreign exchange due to quantitative easing (QE) in Europe and Japan are likely to exert further pressure on the price of Thai rice,” Mr Charoen said.

“Falling oil prices are also expected to lead potential rice buyers in Africa such as Nigeria to buy less.”

Moreover, drought conditions are seen lowering domestic production, particularly for the second crop.

Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said lower exports would apply especially to white and parboiled rice, as potential buyers are expected to shift to cheaper grains from other rice producers because of falling oil prices and the strong baht.

Vichai Sriprasert, another honorary president of the association, said foreign exchange would play a key role in how Thai rice exports perform, with foreign QE measures of particular importance.

He urged the central bank to help manage the baht and move it in line with the currencies of other regional competitors.

“The Thai baht is now relatively strong compared with other currencies in the region, and even Singapore announced a surprise easing of its currency policy to dampen inflationary expectations and support growth,” Mr Vichai said.