Thai gov. approves easing feed grains imports rules for 3 months

Thailand’s government has approved the relaxation of the country’s feed wheat and corn import requirements for the next three months in a bid to address a shortage in the domestic market amid high world prices, local media has reported.

The government has eliminated current restrictions on wheat imports for the period from May to July that required feed mills to purchase domestic corn at a guaranteed floor price before they were able to import feed wheat at a proportion of 1-3 in favor of domestic corn.

It has also allowed the import of 600,000 mt of optional origin corn without the 20% import duty that is typically levied during the period, versus an initial quota at 54,700 mt.

Usually, only Asian origins that have a free trade agreement with Thailand are able to import into the country as they are under the duty-free unlimited quota scheme.

All other origins are subject to a 20% tax within the 54,700 mt quota, and then all out-of-quota imports are subject to a 73% tax rate.

That comes as another big Asian buyer, the Philippines, is currently considering the easing of its import requirements for corn as it battles to control food inflation in the country, with conditions worsening after Russia invaded Ukraine back in late February in a catastrophic move that has pushed world grain prices higher.

The Philippines economic council approved cutting the corn import tariff from 30% to 5% within the minimum access volume (MAV) and from 50% to 15% outside the quota, which stands at 4 million mt annually.

The decision still needs to be approved by the president and is likely to come against the backdrop of elections that are scheduled on May 9.

However, the timing means trade sources are skeptical about its potential impact or whether it will ultimately be passed.

“If the President releases the executive order, then this reduction of tariff will push through, [but] implementing guidelines are also still missing,” a local importer said.

Thailand’s wheat imports in the 2022/23 marketing year is forecasted at 2.9 million mt, in line with last year’s level, with feed wheat imports taking the lion’s share of that, according to the USDA.

Philippines’ wheat imports are expected to drop 3% in the 2022/23 marketing year to 6.3 million mt amid high prices and supply challenges amid the ongoing war in Ukraine.

Both countries are traditional wheat buyers, but corn imports were only coming from countries within the Asean agreement, while countries were protected from imports from big suppliers as much cheaper international prices could negatively affect domestic production.  

But the recent situation where all grain commodities have reached new highs, led largely by wheat, means countries are looking for possible ways to ease the food inflation internally.