Restrictions to slow imports of feed wheat into Thailand

07.12.2016

Wheat imports to Thailand in the first quarter of the 2016-17 marketing year increased 15% over the same period a year ago, boosted by a 29% increase in imports of feed wheat, according the U.S. Department of Agriculture’s Foreign Agricultural Service.

Despite the strong first quarter, the FAS in a Nov. 29 report indicated that full year wheat imports for the 2016-17 marketing year remain unchanged from earlier forecasts of 3.6 million tonnes. A sharp slowdown in feed wheat imports is expected in the second half of the 2016-17 marketing year, the FAS said, as the government of Thailand in November implemented restrictions on imports of feed wheat.

“Under the new regulations, import permits will be required for the import of feed wheat,” the FAS said. “Also, feed wheat imports will be subject to a 3 to 1 domestic corn absorption requirement, meaning that in order to import a ton of feed wheat, a mill would have to use 3 metric tons of domestic corn. In addition, the government set the minimum purchase price for domestic corn at 8 baht/kg ($227) for feed mills. Moreover, the Department of Livestock Development will review compound feeds containing feed wheat due to alleged concerns about aflatoxin and radiation contamination of imported feed wheat.”

Thailand’s feed wheat imports come mainly from Ukraine and Argentina.

The FAS noted in the report that Thailand’s domestic corn production is expected to “increase significantly” due to favorable weather conditions. Meanwhile, imports of milling wheat are expected to continue to trend upwards due to consumption growth of wheat-based foods, particularly for bread and instant noodle products, the FAS said.

Import demand for U.S. wheat is expected to increase to around 700,000 tonnes in 2016-17, which would be up 3% from 2015-16, the FAS said.


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