China buy to boost rice exports
China has agreed to buy 100,000 tonnes of rice from Thailand under a government-to-government (G2G) contract, a move the Commerce Ministry says will support local prices and boost rice exports.
Commerce Minister Sontirat Sontijirawong said the latest purchase of 5% newly harvested white rice will be delivered later this month and next month.
"The deal is good news for farmers and the Thai rice market, as there are advance purchase orders for rice from the beginning of the main crop," Mr Sontirat said. "The purchase helps domestic paddy prices and indicates that China may need to import more Thai rice in the remaining months of this year."
China National Cereals, Oils and Foodstuffs Corporation (Cofco), a state enterprise that supervises the mainland's annual rice import quotas, had halted purchases since the middle of this year because of ample rice supply at home.
Thailand previously supplied 500,000 tonnes of rice to China as part of a pledged G2G deal struck in 2015 for 1 million tonnes of grains.
Mr Sontirat said the Foreign Trade Department will speed up talks with the Chinese state unit to agree on purchase prices and shipment of the remaining 400,000 tonnes under the 2015 pledge.
In addition, the ministry pledges to rev up a proactive approach to promote rice exports during the beginning of the annual main crop, he said.
During Sept 12-20 the department held promotional activities and a roadshow in Australia for Thai premium-grade grains such as Riceberry and Kor Khor 43, recommended for diabetics because of low sugar levels.
In addition, the department participated in the 15th China-Asean Expo held in Nanning, China during Sept 12-15 to promote Thai rice and seek out new distribution channels.
With higher purchase demand and the ministry's continuous marketing efforts, Mr Sontirat said the ministry is confident of achieving 11 million tonnes of Thai rice exports as targeted this year.
As of Sept 21, Thailand had exported 8.22 million tonnes of rice, up 2.9% on year-earlier levels. The amount was worth 135 billion baht, up 13.6% year-on-year.
Charoen Laothammatas, president of the Thai Rice Exporters Association, said any delays for the remaining 400,000 tonnes under the G2G contract between Thailand and China are unlikely to affect Thailand's exports much this year.
He cited strong purchase demand in the global market, with shipments in August recording 1.08 million tonnes of milled rice.
The exporters also predict that Thailand's rice exports will reach 11 million tonnes for the full year.