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Floods Destroy 470,000 Tonnes of Thai Rice Crop

Source: Reuters
13/11/2008

Tokyo, Nov 13 - The yen retreated from a two-week high against the euro on Thursday as short-term players locked in profits, but it retained its overall strength as investors remain wary of riskier assets and favour the perceived safety of the Japanese currency amid fears of a global recession.

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"Floods hit rice fields in the north and the northeastern regions and destroyed around 2 percent of our main rice crop, which equates to around 470,000 tonnes of paddy," Apichart Jongskul, secretary-general of the agricultural economics office in the Agriculture Ministry, told Reuters.

Thailand is expecting 23.8 million tonnes of paddy from its main crop, harvesting in November, according to ministry data.

However, traders said a drop in supply of this size was unlikely to have much of an impact on prices.

"The key problem pushing rice prices lower is falling demand," one exporter said.

Benchmark 100 percent B grade white rice fell to $530 per tonne on Wednesday, down from last week's $550, and is now less than half its record high of $1,080 per tonne in April.

The price was expected to fall further over the next few weeks due to increasing supply as the government is about to release 2.5 million tonnes of rice from its stocks after a tender last week to sell 3.1 million tonnes.



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