"Global rice prices are on an upward trend, which will pave the way for local rice traders to set a new base price to between Bt8,000 and Bt10,000, from Bt6,000 per tonne now," said Sumeth Laomoraphorn, executive vice president of Charoen Pokphand's international-trading business group and managing director of CP Intertrade.
However, the maximum rice price may not be as high as today's, because there is changing demand and supply for rice, he said.
In a recent bidding by the Philippines, Vietnam's price offer reached $1,200 for 25-per-cent white rice.
Despite rising rice prices, CP Intertrade, as a packer of the Royal Umbrella brand, will try to freeze its current selling price of Bt190 to Bt195 per 5-kilogram pack, said Sumeth.
He said the company would try to control its retail prices despite limited production capacity and rice supply, which have moved gradually this year due to high demand in both domestic and foreign markets.
CP Intertrade moved 500,000 tonnes of rice last year, of which 350,000 tonnes went for export. It expects its total trade for this year to jump to 900,000 tonnes, with exports rising to 450,000 tonnes.
In addition to increasing rice-production capacity for the country, the group has suggested farmers use cross-breeding to increase production per yield, in order to ensure supply and prolong benefits as a major exporter.
Anek Silapapun, senior vice president of CP's crop-integration business group, said the adoption of cross-breeding seed would increase yields from an average of 430 kilograms per rai to 1.2-1.5 tonnes per rai and reduce the harvest period from 115 days to 90.
"Farmers would have only a small cost increase, up from a total of Bt750 to Bt1,500 per rai, but they would be able to increase from between two and two-and-a-half crops a year to three crops a year," he said.
CP has spent seven years developing cross-breeding white rice, called CP 304. So far, it has distributed about 4,000 seeds to farmers, who can grow a maximum of 1.52 tonnes per rai. The company is experimenting with cross-breeding jasmine rice and expects to achieve a result in the next five years.
Anek said the company had also sold its cross-breeding technology by investing in an experimental field in China, which a capacity of thousands of seeds per year.
The Nation, April 23, 2008