Twice-monthly auction of pledged rice
The Commerce Ministry’s Foreign Trade Department plans to auction a total of 400,000 tonnes of different types of rice twice a month to reduce the huge stockpile of pledged grain.
- Published: 31/07/2013 at 05:06 PM
- Newspaper section: breakingnews
The government in June ordered inspections of rice stocks kept at warehouses nationwide.
Each auction will try to sell about 200,000 tonnes, said Pranee Siriphand, director-general of the Foreign Trade Department, which is responsible for selling the government's mountain of rice accumulated from the rice pledging scheme.
The department on Wednesday afternoon agreed to sell 120,000 tonnes of unmilled 5% white rice to be processed into parboiled rice for export, in the wake of the lukewarm response to the 200,000 tonnes on offer.
The 120,000 tonnes of rice would produce 75,000-80,000 tonnes of parboiled rice. The department did not disclose the selling price.
This week's auction closed at 4.30pm on Tuesday, with tenders from only five companies - Capital Rice Co, Chaiyaporn Rice and Food Products Co, Asia Golden Rice Co, Kamolkij Co and Royal Richy Rice Co.
The Royal Richy Rice bid was unsuccessful.
The department offered 5% white rice from a total of 101 millers situated in 24 provinces. These millers hold a combined amount of 2.2 million tonnes of rice in their warehouses.
The government needs to sell off much of the 17 million tonnes or more of pledged rice in stock to have space to store grain bought from the next harvest, that will begin in October and continue through to next year.
The department opened bidding envelopes and then negotiated with interested buyers to get the best price on Wednesday afternoon.
An industry source said exporters were expected to offer 8,000 to 10,000 baht a tonne, based on the global price of Thai parboiled rice at US$520-530 a tonne, or around 15,000 baht.
The actual cost to traders after processing would be around 11,000 baht a tonne, so the offering price will be lower than this price.
Vichai Sriprasert, honorary president of the Thai Rice Exporters Association, said bidders were finding it difficult since the terms of reference (ToR) do not state clearly where the paddy is located, or what types of rice will be put up for auction.
About the author
- Writer: Phusadee Arunmas