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Representatives of the private sector urged the government to capitalize on the global shortage of food and increase food exports.
They also said inflation and the global economic slowdown are now their main concern for the Thai economy and maintained their economic growth projections for 2022.
“The global food crisis is escalating to the point where countries are already banning the export of food and Thailand could benefit from the exports of agriculture goods and food products,” said Sanan Angubolkul, chairman of the Thai Chamber of Commerce and the current chairman of the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB).
“The prolonging of the war between Russia and Ukraine will contribute to less agriculture production and higher food prices,” he said.
Sanan pointed out the Food and Agriculture Organisation of the United Nations’ Food Price Index (FFPI) which averaged 158.5 points in April, down 0.8 per cent from the all-time high in March but remained 29.8 percent higher than in April 2021.
The FAO Chief Economist Máximo Torero Cullen said in a statement in April that the small decrease in the index was a “welcome relief” for low-income food-deficit countries but the global food prices are still high and it is posing a challenge to global food security.
Sanan said more than 20 countries have already imposed a ban on food export, especially for wheat, sugar and vegetable oil. The FAO said uncertainties over export availabilities out of Indonesia, the world’s leading palm oil exporter, are currently a major concern for vegetable oil prices.
They said international wheat prices are still being affected by the war between Russia and Ukraine, both are large producers, while international rice prices continue to increase from March to April, driven by strong demand from China and Near East.
International sugar prices also continue to increase from March to April, with higher ethanol prices and concerns over the slow start of the harvest in Brazil, the world’s largest sugar exporter.
Sanan said the chance for Thailand to run out of food is small as the domestic demand is still lower than domestic production and the stockpiles are still high.
“Countries are banning the export of food and this represents an opportunity for Thailand’s exports,” he said.
“Nevertheless, there is a need to monitor the global situation, manage the stockpiles of agriculture and food products accordingly and make sure that there is no shortage of raw materials such as fertilizers and animal feedings.”
For the economic projections, the JSCCIB has maintained that Thailand’s GDP could expand by 2.5 to 4 per cent in 2022, based on assumptions that exports will expand by 3 to 5 per cent and inflation stay around 3.5 to 5.5 per cent.
Sanan said businesses are now concerned that inflation will slow down domestic demand and the global economic slowdown could affect Thailand’s exports.
He said the global economy is being affected by the war in Ukraine, the global shortage of food, many countries are experiencing high inflation, the lack of raw materials within the global supply chain and the trend of hiking interest rates.
He said the showdown in China is the main concern where the market is now expecting the mainland to expand by 4.5 per cent after its latest economic numbers were released compared to Beijing’s previous estimate of 5.5 per cent.
For tourism, the JSCCIB expects around 6-8 million foreign visitors in 2022.