return icon

Thai policy on rice subsidy is double-edged sword for Vietnam

The government of Thailand has approved a budget of 21.5 billion baht to ensure a rice price at a reasonable level for Thai farmers. The policy is expected to have a negative impact on other export countries, including Vietnam.

The program is expected to benefit 892,000 rice farmers who have registered with the Thailand Ministry of Agriculture and Cooperatives. The aim of the program is to ensure that the rice price brings reasonable profits to farmers despite price fluctuations.



According to the Vietnam News Agency, the policy will be applied for one year, commencing from October 2019, valid for some kinds of products, including Hom Mali fragrant rice, Pathum Thani, sticky rice and other fragrant rice varieties.

Under the program, the Thai government ensures a stable price of 10,000 baht per ton, or $325, for white rice production, 12,000 baht per ton, or $390, for sticky rice.

Pham Quang Dieu, director of Agromonitor, a market analysis firm, believes the Thai subsidy policy won’t have a big impact on Vietnam’s rice exports, because Thai rice price doesn’t compete with Vietnamese (Thai price is higher).

The government of Thailand has approved a budget of 21.5 billion baht to ensure a rice price at a reasonable level for Thai farmers. The policy is expected to have a negative impact on other export countries, including Vietnam.

“Moreover, Vietnam’s scented rice varieties OM 5451 and Dai Thom 8 now have prices very competitive with Thai scented varieties and they are a favorite in the market,” he said.

According to Nguyen Thanh Phong, director of Van Loi Company, the Thai government uses the state budget to be sure that the rice purchase price is stable even if the market price goes down.

However, the program, to some extent, leads to disadvantages in export. Once Thailand raises the rice purchase price, this means that the cost price is pushed up. In other words, the government’s intervention through the subsidy program would ‘distort’ the market and break market rules.

Meanwhile, when exporting rice, Thailand has to compete with many strong exporters, including Vietnam, India, Pakistan, Myanmar and Cambodia.

“With the subsidy program, Thai rice will not be competitive in the market,” he commented.

However, the director of a rice export company in Mekong River Delta said if Thailand subsidizes the rice price, which leads to difficulties in exporting rice, or to high inventory level, this would badly affect other rice export countries, including Vietnam.

In the past, Thailand once applied a similar program under the administration of Yingluck Shinawatra in 2011, which led to a record high inventory level of the country, which exceeded 11 million tons at times. Finally, the government of Thailand had to clear the stockpile at low prices, thus affecting Vietnam’s exports.

As such, Thai subsidy policy is believed to be a double-edged sword for Thailand’s rivals, including Vietnam.

Kim Chi 


China no longer largest buyer of Vietnam rice

China no longer largest buyer of Vietnam rice

China’s rice imports from Vietnam plummeted during the first few months of 2019, pushing it off Vietnam’s top rice consumers list.  

Vietnam’s rice exports to Philippines up, but farmers aren’t happy

Vietnam’s rice exports to Philippines up, but farmers aren’t happy

Rice exports to the Philippines have increased sharply as the country has lifted quotas since the beginning of the year. However, Vietnamese farmers have not received big benefits.


Multi-billion thermal power project needs more capital

The Ministry of Industry and Trade (MOIT) has asked for ministries' opinions on solutions to problems related to the balance sheet of the Vung Ang 1 thermal-power plant.

The best September photos on VietNamNet

Hot air balloons with the Vietnamese national flag of 1,800m2 on the banks of the Saigon River, Typhoon Noru making landfall in Quang Nam Province, the roofs of many houses being blown away...

BSR to expand Dung Quat Oil Refinery

The Ministry of Industry and Trade (MOIT) has asked Binh Son Refining and Petrochemical JSC (BSR) to clarify some issues related to its project on expanding Dung Quat Oil Refinery.

Dutch conductor to lead concert at Opera House

Conductor Leon Bosch from the Netherlands will lead a concert featuring masterpieces by European composers at the HCM City Opera House on Saturday, October 8.

‘578’ to represent Vietnam at Oscars

An action film starring Miss Universe Vietnam 2018, H'hen Niê, 578: Phát Đạn Của Kẻ Điên (578: Magnum), has been selected as Vietnamese representative at the 95th Oscars, 2023.

USD surges to VND24,000, US$1.7 billion withdrawn from circulation

The State Bank of Vietnam (SBV) withdrew nearly VND41 trillion ($1.7 billion) through open market operations as the US dollar rose to over VND24,000 on September 26-30, 2022.

HCM City to build a series of new traffic projects

HCM City is speeding up procedures to start the construction of key traffic works at gateways by the end of the year, according to HCM City's Department of Transport.

Burning garbage in Hanoi threatens residents' health, property

There have been consecutive fires caused by people's poor awareness, who were burning garbage and straw in residential areas, causing fires recently in Hanoi.

New cargo airline still waiting for license

After the Prime Minister agrees on the establishment of IPP Air Cargo, the Ministry of Transport (MOT) will implement procedures to grant a license to the air carrier, according to MOT Deputy Minister Le Dinh Tho.

Master plan for Mekong Delta focuses on infrastructure development

The Master Plan for the Mekong Delta designed for 2021-2030, with a vision to 2050, is focused on infrastructure development.

Current monetary policy quite suitable

Many people are concerned whether the country will face a tighter monetary policy and higher exchange and interest rates in the near future.

Danang, a wedding destination for India’s billionaires

Could Danang be the wedding destination of choice for Indian billionaires? It certainly has the right hotels and quality wedding infrastructure for the purpose, an Indian tourism company representative said.

Big shortage of human resources for artificial intelligence

Vietnam is facing a big shortage of human resources for artificial intelligence.

VN to improve science and technology market to reduce reliance on imports

Vietnam plans to focus on improving the science and technology market with the establishment of three trading platforms in order to reduce reliance on imports, Minister of Science and Technology Huynh Thanh Dat has said.

Vietnam may not reach goal of 5 million int’l visitors in 2022

Vietnam’s tourism industry aims to serve 60 million domestic tourists in 2022. By the end of July, the figure was already over 71 million visitors.