The government will let international state enterprises and foreign rice traders buy rice directly in a move to boost sales of the state's huge rice stockpile.
Niwatthamrong: Lots of interested buyers
Deputy Prime Minister and Commerce Minister Niwatthamrong Bunsongphaisan, who chairs the subcommittee handling government rice sales, yesterday said the additional channels will help to speed efforts to dispose of the rice.
In its best bid to unload 17 million tonnes of rice sitting in warehouses, the state has sold rice stocks mainly through government-to-government (G-to-G) deals and newly allowed general auctions.
But the push to sell stockpiled rice has met with tepid sales.
After the latest rice auction, the Commerce Ministry on Tuesday said it had tentatively agreed to sell 30,000 tonnes of rice out of 200,000 tonnes offered via tender on Monday.
This week's tender was the third offer by the Thai government to sell rice to traders.
For the first two rounds last month, the government accepted bids for 120,000 tonnes of paddy and 90,000 tonnes of milled rice.
The total was less than half of the 550,000 tonnes originally offered.
Aside from tenders, the government signed a contract last month to sell 250,000 tonnes of rice to Iran via the G-to-G channel.
In addition, plans call for selling 150,000 tonnes on the Agricultural Futures Exchange of Thailand next month.
Rice traders have shown lukewarm interest in the rice bidding, with some saying the government-set prices are too high while global demand is weak.
Trust is also an issue, with traders questioning the quality of the stored rice.
Mr Niwatthamrong insists there are still many interested buyers for Thai rice, saying a number of foreign state enterprises and private trading firms from China and the Middle East have approached Thai officials about buying stockpiled rice.
But Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, warned the new channel will do more harm than good to Thai rice exports and rice prices.
"This will open room for international traders to directly compete with Thai exporters," he said.
"It will eventually affect rice prices in the global market."
About the author
- Writer: Phusadee Arunmas
Position: Business Reporter