Demand analysis of rice in Thailand

Graduation date: 1964Rice has been an important integral part of the economy of\ud Thailand or centuries. Not only is rice the staple diet of the people\ud but it also provides the major part of export earnings as well. Since\ud economic development is stressed in Thailand, a demand study of\ud rice is appropriate, especially domestic demand, in order to aid in\ud determining a sound agricultural development plan.\ud The purposes of this study were: (1) to examine the trend in\ud rice production, (2) to investigate the factors affecting the domestic\ud demand for rice, (3) to consider the relative importance of rice to\ud economic growth, and (4) to project future domestic demand for rice.\ud In the past decade the trend in annual rice consumption per\ud capita has varied from 108 to 137 kilograms with no apparent trend\ud although there has been some decline in the past three years.\ud Change in the price of rice and income of consumers do not have a\ud significant effect on quantity of rice consumed. The very significant \ud factor that does affect the change in aggregate demand for rice is the\ud growth of population which is at the rate of 3.2 percent. It is estimated\ud that a change in one million population is associated with a\ud change in the same direction of 170,000 tons for rice consumed. As\ud for demand for other purposes in the country, demand for seed should\ud remain stable because the farm land area is not expected to increase,\ud while demand for miscellaneous uses will be an increasing trend.\ud Demand for export has varied from 1.0 to about 1.6 million\ud metric tons during the last ten years. The major factor affecting the\ud rice export volume is the production of the previous year. Price of\ud rice in the world market and income of the importing countries seems\ud to be next in importance.\ud The projected domestic demand in 1970, which is estimated\ud at 8.80 million metric tons, combined with the amount of the average\ud export in the last decade, which is 1.30 million metric tons (2.00\ud million metric tons on a paddy basis), means total requirement of\ud 10.80 million metric tons. If production is maintained at the 1961\ud level which was 7.85 million metric tons, the supply of rice will\ud fall short of total requirements by 2.95 million metric tons or 27.3\ud percent,\ud In the past several years rice production has not increased in\ud proportion to the increase in the farm area. Therefore, ways and\ud means must b e found to meet increasing requirements by\ud increasing both production and productivity at the same time. Only\ud in this way will there be enough rice for domestic use and for export\ud which is essential to continued growth of the country.\ud An economic development plan needs to emphasize an increase\ud in rice production which will help increase the growth rate of the\ud GNP and, of course, increase the income to farmers