The government is expected to decide on the venue for a central market for milled rice as a distribution channel for traders and farmers by mid-year, at a cost of 300-400 million baht.
Suthatsanee Rajruangrabin, deputy director-general of the Internal Trade Department, said officials are still looking for a proper area in Bangkok's outskirts to establish the market.
"The department proposes the central market for milled rice be located at Talad Thai, Thailand's largest market for food products, or the planned AEC Trade Center close to Thammasat University Rangsit Campus," she said. "There has also been a private proposal to locate it at the rice processing plant of Patum Rice Mill and Granary Plc."
Ms Suthatsanee said proper locations need at least 3,000-6,000 square metres and should have complete facilities such as an office building.
The AEC Trade Center belongs to TCC Land Asset World Co, a property arm of billionaire Charoen Sirivadhanabhakdi.
She said the Commerce Ministry is in the process of asking for 300-400 million baht for the market to be financed by the additional mid-year budget of 190 billion baht for fiscal 2017, approved by the cabinet in December.
Some 40 groups of rice farmers and 20 rice operators have agreed to participate in the planned central market for milled rice.
Although Thailand is a leading producer and exporter of rice, averaging 20 million tonnes of milled rice a year, it has no central market for trading milled rice thus far. Such a marketplace would enable importers, wholesalers and retailers to shop for different grains.
Late last year the government pitched the idea of setting up a central market as another distribution channel for traders and farmers after Commerce Minister Apiradi Tantraporn visited China last year and observed the Sanyanqiao Grain and Oil Wholesale Market, a large central market for cereals in Guangdong province operated by the Guangtie Sanyanqiao Grain Goods Yard.
The Guangdong market spans 100,000 sq m, handling trading services for 2.5 million tonnes of cereals a year.
Mrs Apiradi said earlier a new central market for milled rice will enable exporters, millers and farmers to meet potential buyers direct and compare prices. It will also require rice quality inspections, helping ensure transparency in trading. Farmers can also sell their grains direct to potential buyers.
Thailand has a central market for rice paddy.
She said the presence of a central market for milled rice would further strengthen the local economy.
The cabinet in December approved an additional mid-year budget of 190 billion baht for fiscal 2017, where more than half of the fund was earmarked to finance investment in provincial clusters.
Some 115 billion baht will be allocated for local development of provincial clusters. The government has sought to increase budgets for provincial clusters, hoping it will spur private sector investment.
The additional mid-year budget is expected to start being disbursed by April or May.
Ms Suthatsanee said the ministry set a target of monthly rice trading at the central market of at least 50 million baht, or 6,250-7,500 tonnes a month. The market could help boost exports by 1% or about 95,000 tonnes, worth 1.49 billion baht, she said.