Insight Focus
Chinese appetite for Thai cassava is growing. This is mainly driven by the Chinese trade war with the US, which caused corn imports to decline by 98%. But lower demand in recent months has led to a production decline, and potential supply limitations from Cambodia could tighten the market further.
Thailand’s Cassava Industry Struggles in 2024
After a year of cassava oversupply in Thailand in 2024, the market seems to be rebalancing. Last year, the average price of cassava chips dropped to around THB 5,600/tonne, the lowest level in several years.
China, which usually buys over 90% of Thailand’s cassava chip exports, began to turn instead to corn and coal for ethanol production, reducing its demand for imported cassava.
But due to the trade war with the US, Chinese imports of corn tumbled by 98%, pushing up domestic corn prices and creating a new opportunity for Thai cassava to return to the market as a substitute.
China resumed imports of alternative feed ingredients, including pelletized cassava from Thailand, which serves as an effective substitute for corn in animal feed.
Cassava Production Set to Decline
However, the difficulties of 2024 led many farmers to reduce their cassava planting areas. As a result, total production for the 2025 and 2026 seasons is expected to fall to approximately 21.5 million tonnes, compared to previous years when production typically ranged between 26 and 28 million tonnes.
With supply expected to decrease and demand from China continuing to rise, cassava prices are likely to remain stable or move higher during the second half of 2025.
Thailand is also considering restrictions on cassava imports from Cambodia by possibly closing some border checkpoints due to rising political tensions. Cambodia normally supplies about 47% of Thailand’s cassava imports.
In early 2024, which was cassava harvest season, Thailand still imported large volumes of cassava roots from Cambodia as domestic prices hit a seven-year high. This significant inflow of imported roots may have contributed to the sharp price decline seen in 2025.
Thailand’s recent decision to limit cassava imports through border closures has raised ongoing debate. Supporters believe this could help keep domestic prices stable by reducing the supply of cheaper cassava from neighbouring countries.
On the other hand, some are concerned that restricting imports could lead to shortages of raw materials, especially for factories that rely on a steady supply. With fewer exports going to Thailand, Cambodia may start sending more cassava to Vietnam at lower prices. This would give Vietnam access to cheaper raw cassava, making it harder for Thailand to remain competitive in the global cassava industry.
Cassava Exports Soar in Early 2025
Thailand’s cassava chip exports have already rebounded in the first half of 2025, increasing by 129% year over year compared to the same period in 2024.
Cassava pellet exports stood out with a remarkable growth of 685% year over year, driven by urgent demand from China. China remained Thailand’s largest buyer, accounting for more than 60% of total cassava pellet exports.
This trend has had a positive impact on Thai farmers and suggests the potential start of a new upward cycle in cassava prices, provided the current momentum continues.
Cassava Starch Market Stabilises
Thailand’s cassava starch market is showing some signs of stabilisation, though export volumes have yet to show a clear upward trend.
The sector is still under pressure, but prices appear to have bottomed out, which offers some relief to farmers.
Both cassava and cane markets look strong in 2025. Cassava is becoming more attractive again because of its shorter growing cycle and better drought resistance.
However, sugarcane remains a strong contender, supported by high global sugar prices and ongoing government incentives. Farmers’ planting decisions in the second half of the year will likely depend on rainfall patterns and future price trends.
If border closures with Cambodia are implemented later this year, the reduced imports of cassava could tighten domestic supply. This may lead to higher raw material costs, which in turn could increase the FOB prices of cassava-based products.
Rising production costs could weaken Thailand’s position in export markets, especially compared to countries like Vietnam that have access to lower-cost raw materials.
