Thailand is experiencing a shortage of maize, the main raw material in feedmeal. The increased need of animal feed due to this year's strong livestock market plus the high world market price for maize which is driving Thai traders to export, is contributing to the shortage.
To lessen the shortages the Thai government have approved a proposal from the Commerce Ministry to import 30,000 tonnes of maize from Laos to supply small feedmills.
The Public Warehouse Organisation (PWO) has been authorised to import the maize from now to the end of May. The local maize harvesting season begins in July.
The Bank for Agriculture and Agricultural Cooperatives will lend the PWO nearly €8.4 million (337 million baht) to pay for the maize, priced at about 0.17-0.19 euro cents a kilogramme. About €7.5 million will be for the maize and the rest will cover operating costs.
According to Parkdehans Himathongkorn, deputy government spokesman, the maize will be imported at a 0% Asean Free Trade Area tariff rate.
Thailand's maize production is estimated at 4.78 million tonnes this year, while domestic demand is 4.525 million tonnes. Exports are projected at 190,000 tonnes.
Last year, Thailand bought about 387,400 tonnes of maize from Laos and Cambodia.
It is estimated that the local livestock industry will use about 15.22 million tonnes of feed meal this year to feed about 1,160 million chickens, 600,000 tonnes of shrimp, 350,000 head of cattle, and 2.2 million pigs.
An association source said that many feed mills are reluctant to import grain because of high prices.
"We're not certain about the quality of maize from neighbouring countries. Considering the low price of 0.17 euro cents (7 baht), the government will have to inspect the grain," the source said.
The source was surprised that the government still allow traders to export maize despite high demand in the domestic market.
The cost of maize rose from 0.25 euro cents a kg to 0.26 euro cents in February to March