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7 Jun 2013

Agriculture

[AEC Plus] Ample Opportunities Seen in Myanmar’s Rice Market (Current Issue No. 2368 Full Ed.)

International investors are now eyeing Myanmar's rice market and related-businesses due to such favorable factors as the government's ambitious goal to restore their status as the world's leading rice exporter. KResearch is of the view that such intent, along with Myanmar's endeavor to expedite market-oriented rice production, will facilitate them to achieve an export target of 2 million tons in 2013 and 3 million tons in 2015 without much difficulty. We also expect that Myanmar will become one of the world's top five rice exporters again, rivaling India, Vietnam and Thailand, etc., with annual shipments of at least 5 million tons over the next 10 years.
Thai rice entrepreneurs thinking of tapping into Myanmar's rice market may consider investing into rice milling that should offer relatively bright prospects ahead. They might also use Myanmar as an export base. Other interesting options would include the commercial rice trade and related businesses. Forming business alliances, e.g., joint-ventures would likely be the most appropriate strategy during the early market penetration stage.
Although there are numerous impediments such as red tape in setting up rice mills and inadequate infrastructure vis-à-vis Myanmar's rice market now, KResearch is of the view that they will soon improve in tandem with continuing foreign investments into Myanmar. Thus, investing into this country amid Baht forex volatility and the fact that our rice industry is beginning to lose competitiveness should be a viable option for Thai entrepreneurs who are ready to do so.

Meanwhile, since attempts by neighboring countries, including Myanmar, to bolster their rice production may undermine the long-term global competitiveness of Thai rice, our new rice policies and strategies should place importance on any effects that they may have on our rice production. This is imperative to sustaining our global competitiveness, given the steepened protectionism and competition now seen in global rice trade.

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