Thailand starts the new year having surrendered its crown as the world's top rice exporter, and saddled with an ever-growing stockpile of the grain as the costs of its subsidy scheme mount.
However, one thing appears increasingly certain about the programme to pay farmers above-market prices for their rice: it will continue as long as it secures votes for Prime Minister Yingluck Shinawatra and government coffers hold out. Thailand is estimated to have exported about 6.8 million tonnes of rice in 2012, down about 35 percent from the prior year, as the costs of the intervention scheme made Thai prices
This figure is based on forecasts by traders as the government removed data from its website last October and officials will no longer divulge data. This is classic head-in-the-sand behaviour, but Thailand's rice problems won't disappear just because the government tries to conceal what is happening.
India is the new number one rice exporter, taking the title for the first time since 1983, with exports likely to be about
8.5 million tonnes in the fiscal year to the end of March 2013.
In second spot is Vietnam with 2012 exports of about 7.7 million tonnes. It is no surprise that Thailand's rice exports slumped, since its prices are about 37 percent above those of Vietnam and India.
Thailand now has more than 12 million tonnes of stockpiled rice, about a fifth more than the most it has ever exported in a year. The authorities are maintaining they will sell 7 million tonnes in government-to-government deals in 2013, but to say the market is sceptical would be putting it mildly.
Commerce Minister Boonsong Teriyapirom claimed in September that Bangkok had contracts to sell 7.3 million tonnes in 2012 to countries including Indonesia and the Philippines.
The problem was that those countries denied any deals had been signed and traders didn't see any cargoes leaving Thai ports.The government did sign a memorandum of understanding with China to allowing rice exports to Beijing, but so far there is no sign of any additional cargoes.
In fact, quite the opposite is true, with Thai rice exports to China falling 52