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Rice exports: Govt likely to lose money

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Lots of rice on world markets so low rice prices but Thai rice is expensive, so who is going to buy Thai rice? 

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AGRICULTURE

Rice shippers scoff at forecast

18 Feb 2013
Phusadee Arunmas

The government expects to deliver 2.5 million tonnes of rice through government-to-government (G2G) contracts this year amid scepticism from the private sector that the goal is daunting, given the relatively high price of Thai rice and burgeoning supplies.

"The target can be achieved but only in the case that the government sells its rice stock at loss," said Sompong Kitireanglarp, president of the rice exporter Ponglarp Co Ltd. 

Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, agreed that given the abundant world rice production expected this year and the high-priced Thai product, the odds are long for the state to sell its rice stocks profitably.

Thai 5% white rice is now quoted at US$590 a tonne, while similar rice from Vietnam is quoted at $390-400.

"This year's overall rice market still belongs to the buyers, not the sellers," said Mr Chookiat.

The government can sell its rice stocks in any amount it claims if it dares sell its rice stocks at prices of $420-430 a tonne.

The government delivered 1.4 million tonnes of rice from its stocks through G2G deals last year.

A Commerce Ministry source said the government plans to deliver 2.5 million tonnes of rice by year-end including 38,000 tonnes that have been delivered to Ivory Coast so far.

Vatchari Vimooktayon, the commerce permanent secretary, earlier this year announced the ministry planned at best to sell 7 million tonnes of rice stocks on top of the 7.33 million tonnes previously announced by Commerce Minister Boonsong Teriyapirom.

Last September, Mr Boonsong said his ministry had concluded six export deals through G2G contracts with Indonesia, the Philippines, China and Ivory Coast.

The ministry source said several African nations including Togo, Guinea, Cameroon and Chad are interested in Thai rice.

Togo imports 200,000 to 300,000 tonnes of Thai rice a year, mostly in the form of white and parboiled rice.

Most recently, Togolese authorities sent a letter of intent to the Commerce Ministry to buy 100,000 tonnes of rice.

But the source said Togo still owes $1 million to Thailand for past rice deals, so the new purchase needs approval from the National Rice Policy Committee.

African countries are expected to remain the key buyers of Thai rice, followed by China, said the source.

Thailand shipped 3.57 million tonnes of rice to Africa last year, making up 51% of total rice exports.

Overall rice exports totalled 6.94 million tonnes, down by 35% from 2011.

The UN Food and Agriculture Organization recently said rice stockpiles in Thailand will surge to a record high this year, driven by the government's pledging scheme.

Milled holdings may jump 40% to 18.2 million tonnes in 2013, the Rome-based agency said in its latest report on the global rice market .

The reserves, which averaged 5.4 million tonnes a year from 2008-10, increased to 7.8 million tonnes in 2011 and are still rising, said the report.

It said government stock-release plans have progressed slowly, further aggravating the supply situation for an export sector that is faced with little offshore demand.

(Source:
Economics, AGRICULTURE, Rice shippers scoff at forecast, 18 Feb 2013, Phusadee Arunmas, link


Rice Industry Vocabulary

ship - send goods from one place to another by ship, truck, air or rail ขนส่งทางเรือรถไฟรถยนต์เครื่องบินหรืออื่น ๆ
shipment - the goods sent from one place to another place การขนส่งสินค้า, การส่งสินค้า

shipper - the person or company that sends the goods from one to another
rice shipper

forecast - a statement about what will happen in the future based on information available now พยากรณ์

scoff - to laugh at something (to show that you do not respect something), deride, jeer  พูดเยาะเย้ย, ล้อเลียน, เสียดสี
scoff at forecast

Rice shippers scoff at forecast

government-to-government (G2G) - sales from one government to another government (no private profit-making companies involved)
contract -
agreement  สัญญา
government-to-government (G2G) contracts

scepticism - not believing in things easily or quickly, questioning them ความสงสัย,ความแคลงใจ,ความระแวง,ความไม่เชื่อ
scepticism from the private sector 

sector - a part of the economy (public sector = government, private sector = all businesses, household sector = families and consumers, banking sector,...)   ภาคเศรษฐกิจของประเทศ (See Wikipedia)
private sector -
all the businesses in the country (owned by people, not the government)

daunting
- difficult to do or achieve
a daunting goal
scepticism from the private sector that the goal is daunting

burgeoning - growing or developing quickly

The government expects to deliver 2.5 million tonnes of rice through government-to-government (G2G) contracts this year amid scepticism from the private sector that the goal is daunting, given the relatively high price of Thai rice and burgeoning supplies.

target - a goal; the amount you are planning to achieve เป้าหมาย
achieve target 
the target can be achieved

stock - an amount of something that you keep so that you can use it when you need it ที่เก็บไว้ในสต๊อก
rice stock
rice stocks

sells a rice stock at a loss
sell rice stocks through G2G deals

the government delivered 1.4 million tonnes of rice from its stocks through G2G deals last year.

The target can be achieved but only in the case that the government sells its rice stock at a loss

abundant - large amounts of something; more than enough; exists in large quantities มากมาย
abundant world rice production

expected - believe will happen คาดว่า (จะเกิดขึ้น)
expected this year

the abundant world rice production expected this year

state - government รัฐ
stocks - large amounts stored for future use

odds - how likely something is to happen, likelihood, chance, probability โอกาสที่จะเป็นไปได้
the odds are long - not likely, not likely to happen
the odds are long for the state to sell its rice stocks profitably

given the abundant world rice production expected this year and the high-priced Thai product, the odds are long for the state to sell its rice stocks profitably.

quote - a price that a buyer or supplier will sell a good at
rice quoted at $390-400
Thai 5% white rice is now quoted at US$590 a tonne, while similar rice from Vietnam is quoted at $390-400.

a buyer's market - meaning: supply is low, prices low (so it is a good time for buyers to buy, not so good for sellers)
"This year's overall rice market still belongs to the buyers, not the sellers," said Mr Chookiat.

dare - do something that is dangerous (not afraid)
dare to sell at a low price (and lose money)

dare to sell rice at $430 a tonne
The government can sell its rice stocks in any amount it claims if it dares sell its rice stocks at prices of $420-430 a tonne.

source - someone who gives information แหล่งข่าว
A Commerce Ministry source said...

ministry - a government department dealing with an area of activity กระทรวง
the ministry planned at best to sell 7 million tonnes of rice stocks on top of the 7.33 million tonnes previously announced

concluded - finished
the ministry had concluded six export deals through G2G contracts with Indonesia, the Philippines, China and Ivory Coast.

intent - your plan or purpose จุดประสงค์
letter of intent - a letter that tells people what you are planning to do in the future

authorities
- government officials; the police or people in official organisations who have the legal power to make decisions and to make people obey laws or rules เจ้าหน้าที่ (ตำรวจ หรือผู้มีอำนาจ)

authorities in the importing country sent a letter of intent to the Commerce Ministry to buy 100,000 tonnes of rice.

purchase - buy
approval - official permission การอนุมัต
the new purchase needs approval from the National Rice Policy Committee.

key - important คนสำคัญ
key buyers - important buyers

the key buyers of Thai rice - the most important buyers of Thai rice
African countries are expected to remain the key buyers of Thai rice, followed by China, said the source.

stockpiles - large amounts of something stored for future use กองสินค้าในโกดัง
rice stockpiles - large amounts of rice kept and stored for future use

surge - to increase very quickly เพิ่มขึ้นอย่างรวดเร็ว
rice stockpiles in Thailand will surge

record - the best or most ever achieved สถิติ
a record high - the highest level ever, the highest level in history
surge to a record high

rice stockpiles in Thailand will surge to a record high this year

scheme - a plan that is developed by a government or large organisation in order to provide a particular service for people แผนการ โครงการ
the government's pledging scheme

The UN Food and Agriculture Organization recently said rice stockpiles in Thailand will surge to a record high this year, driven by the government's pledging scheme.

rice mill - a factory for preparing and processing rice so it can be sold in stores
milled rice - processed rice, ready to be sold in bags

holdings - things that you own
milled holdings - rice owned that has already been milled

global
- throughout the world; all over the world, including the whole world ทั่วโลก ทั้งโลก
global rice market
latest report on the global rice market

Milled holdings may jump 40% to 18.2 million tonnes in 2013, the Rome-based agency said in its latest report on the global rice market .

reserve (verb) - to keep something for future use or sale สำรอง
reserves (noun) - supply for future use

The reserves, which averaged 5.4 million tonnes a year from 2008-10, increased to 7.8 million tonnes in 2011 and are still rising, said the report.

release - to allow to leave a place or go free ปล่อย
release stocks - when am amounts kept for future use or sale are finally used or sold

stock release
(noun phrase)
stock-release plans

progress slowly - to go slowly (when some planed activity slowly achieves its goals)
stock-release plans have progressed slowly

aggravating -
making the situation worse
aggravating the supply situation

further aggravating - making the situation even worse (already was bad)
further aggravating the supply situation

demand - the need and desire to buy goods and services by households and businesses ความต้องการ

It said government stock-release plans have progressed slowly, further aggravating the supply situation for an export sector that is faced with little offshore demand.

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