Thailand and Vietnam are considering working together to jack up rice prices to increase their bargaining power in the global market, government spokesman Thanakorn Wangboonkongchana said.

Thailand and Vietnam should jointly raise rice prices to boost their bargaining power in the global market, according to Prime Minister Prayut Chan-o-cha, a move that threatens higher food costs for consumers worldwide.

Thailand and Vietnam are the world’s second- and third-largest rice exporters respectively: the two major rice exporters are trying raise to increase farmers’ bargaining power in the global market after more than 20 years of low prices.

This would benefit millions of rice farmers in the two countries who are struggling with rising costs. But the timing may not be appropriate as India may restrict rice exports after similar moves in wheat and sugar.

India is another major rice exporter of over 20 million tonnes per year, compared to 6 million tonnes each from Thailand and Vietnam.

India’s export ban on rice could further aggravate supply cuts that started with Russia’s invasion of Ukraine in late February, as both countries are major grain and fertilizer exporters.

Thailand’s move could also exacerbate the ongoing food inflation: the United Nations estimates global food prices have risen over 34% in the past year, mainly because of the COVID-19 pandemic, which is now in its third year.

COVID-19 has already resulted in broad impacts on food security in Asia, unsettling food supply chains in various ways.  According to the UN’s Food and Agriculture Organization, the number of people experiencing severe food insecurity globally rose by 148 million in 2020 to 928 million—12% of the global population.

About the author

Bangkok Correspondent at Siam News Network

Bangkok Correspondent for Siam News Network. Editor at Thailand Business News

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