• Thailand's rice exports fell 30% annually in the first quarter to 2.1 million metric tons.
• Concerns grow over a potential 36% tariff by the U.S., which could damage Thailand's rice market.
• Competitors like Vietnam are offering rice at much lower prices, challenging Thailand's position.

Thailand's rice exports have seen a significant decline of 30% annually in the first quarter of the year, amounting to 2.1 million metric tons, according to the Thai Rice Exporters Association. This downturn is largely attributed to countries postponing purchasing decisions and India reviving its rice exports, leading to oversupply in the market, reflected in the fall of jasmine and other specialty rice exports Channel News Asia and Bangkok Post.

The U.S. has imposed a 36% tariff on Thai goods, a significant concern for exporters. If these tariffs remain in place following negotiations, it could "slash demand" for Thai rice in the U.S., which is its most valuable export market, according to Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association. Last year's shipments to the U.S. reached approximately 849,000 metric tons, valued at around $735 million Bangkok Post and Reuters.

There are fears that if the U.S. solidifies the tariff, Thai jasmine rice could become too expensive, further undermining its market share against competitors like Vietnam, which offers jasmine rice at substantially lower prices. Ophaswongse indicated that prices for Thai jasmine rice could surge from $1,000 to upwards of $1,400 per ton under the proposed tariff structure, putting it at a disadvantage compared to cheaper rice options from Vietnam Bangkok Post and Reuters.

As negotiations with the U.S. over these tariffs continue, Thai officials, including Finance Minister Pichai Chunhavajira, are remaining hopeful for a resolution that would avoid severe economic repercussions. Concerns have been raised that a failure to negotiate could reduce Thailand's rice exports below the forecast of 7.5 million tons, threatening the livelihoods of farmers Bangkok Post and Bangkok Post.

Overall, analysts predict that challenges will persist as a combination of domestic price declines and international trade dynamics affect Thailand's agricultural sector. Strategies implemented by the government will determine the sector's resilience and adaptability in a rapidly changing global market Bangkok Post and Reuters.