No truth in US Rice Fed fears, says Boonsong

Thai prices 'will boost, not lower competition'

Commerce Minister Boonsong Teriyapirom yesterday dismissed US farmers' concerns that the rice pledging scheme would drive up rice production and lead to dumping of the crop when the stock is released on the market.

Police officers count sacks of rice at a warehouse in Ayutthaya’s Wang Noi district. The counting was part of a preliminary inspection of rice stockpiles after 11,000 tonnes of the grain vanished recently from a warehouse in Nakhon Ratchasima province. APICHIT JINAKUL

Mr Boonsong said the US Rice Federation's fears were unfounded.

With limited farmland and irrigation capacity, an increase in Thai rice production would not have a huge impact on the world market, he said.

He was responding to a news report that US farmers had submitted a letter to the US Trade Representative raising concerns about the Thai government's rice pledging programme.

The commerce minister said rice would not be dumped because the government sold its stocks to local traders at high prices, the equivalent of US$540-560 (16,600-17,200 baht) per tonne, which was $100 (3,100 baht) higher than prices Vietnam and India sold their stocks at.

Thai rice was priced at around $679 (21,000 baht) per tonne on average, an increase of 17.27% compared with last year's price of $579 (17,800 baht).

He said an increase in Thai rice prices should boost rather than lower US competitiveness. In the past, Thai rice prices were much lower than those in the US.

"The scheme doesn't affect rice exports in other countries. On the contrary, they benefit from pledging programmes," he said.

Mr Boonsong said the pledging programme would also ensure global food security in the long run, given the growing consumption of rice.

He insisted the programme was not in breach of World Trade Organisation regulations on crop subsidies, saying the US farm programmes were more likely to affect Thai exporters.

Meanwhile, a 100-strong police squad yesterday inspected 10 government warehouses where 600,000 tonnes of pledged rice were being stored.

The officers were looking for any irregularities.

Led by Buri Ram police chief Pol Maj Gen Rattapong Yimyai, the unit examined stockpiles of the pledged rice from the 2011/12 harvest year in Muang and Prakhon Chai districts. The police team was accompanied by representatives from the Department of Internal Trade and Public Warehouse Organisation.

Pol Maj Gen Rattapong said the inspection found no sign of irregularities.

About 14,000 tonnes had been sent to the Department of Internal Trade for release. It was expected the remaining rice would be sent to rice millers taking part in the rice scheme by the end of this year.

The government needs to clear the warehouses for the 2012/13 crop year.

Pol Maj Gen Rattapong said about 300 farmers has been questioned so far in connection with alleged irregularities in the rice scheme in Nong Ki district. A total of 459 rice farmers were suspected of corruption in the pledging scheme.

He said warrants for the arrest of those accused of cheating in the rice scheme were likely to be issued within two weeks.