Latest rice auction the most successful to date
Another 1m tonnes to go on the block in July
The government has sold 840,000 tonnes in its third rice auction this year, fetching 7.8 billion baht.
The auction is considered satisfactory, as it managed to sell the highest amount of grain since the state rice stocks were put up for sale by this government, said Banjongjitt Angsusing, deputy director-general of the Foreign Trade Department.
Since Prime Minister Prayut Chan-o-cha took office, the Commerce Ministry has held seven bids to speed up disposal of 18 million tonnes of state stocks accumulated from previous rice-pledging schemes.
The ministry sold 2.1 million tonnes for 22.4 billion baht in the previous six auctions.
Ms Banjongjitt said this latest auction sold 79.2% of rice stocks put up for sale compared with an average of 50-60% in the previous auctions.
The Commerce Ministry late last month held the third bid this year and seventh total for 1.06 million tonnes of its rice stocks after it delayed the auction from March upon the advice of exporters and millers.
They wanted to wait for new supply from the season's second crop to enter the market, as that would depress rice prices.
The ministry put up a combined 2 million tonnes of state rice stocks for sale in the first two auctions of this year.
A total of 496,243 tonnes worth 7.85 billion baht were sold in the first auction and 780,000 tonnes worth an estimated 8 billion in the second.
Ms Banjongjitt said the ministry would submit the outcome of the third auction to the National Rice Policy Committee chaired by Gen Prayut for approval on Friday.
The ministry is also scheduled to hold the next auction for another 1 million tonnes early next month, mostly for high-quality white and broken rice.
Charoen Laothamatas, president of the Thai Rice Exporters Association, expects the overall global rice market to remain in the doldrums for the foreseeable future.
His forecast came despite a looming domestic drought and observers' warnings about the potential impact of a prolonged wider drought threatened by the El Nino weather phenomenon that could pose a significant threat to global rice production.
Mr Charoen cited the weak global economy, low oil prices and the weakened euro as factors still suppressing the global rice market.
"The main factors dictating prospects for Thai rice exports is likely to be rice production levels in China and India and how much these countries are affected by drought," he said.
"Prospects are expected to be clearly evident around August, when their main crops start being harvested."
Mr Charoen said rice exporters expected Thailand would ship no fewer than 9 million tonnes this year.
As of Monday, Thailand had shipped 3.9 million tonnes for the year, down by 8% year-on-year.
However, Ms Banjongjitt said rice shipments were expected to fare better in the second half, reaching the 10 million tonnes projected by the Commerce Ministry for the full year.