Govt to tap into warehouse rice amid price surge

Achara Pongvutitham

The Nation

"Local rice prices now are quite high. The ministry has already prepared measures to tackle the problem. However, we don't want to implement any that interfere in the market mechanism," Commerce Minister Mingkwan Sangsuwan said last week.

He declined to reveal how much stock would be released and how much the packed rice would sell for at retail.

On Friday, jasmine rice was quoted at Bt34,450-Bt35,000 per tonne while jasmine paddy rice was asking Bt18,000-Bt20,100.

Lower quality rice such as 100-per-cent white rice was priced at Bt28,500-Bt30,050 while 100-per-cent white paddy rice was trading at Bt13,300-Bt15,500.

The government is closely monitoring the steadily rising rice prices so that local consumption will not be threatened. The rice-bag plan will help consumers fight inflation.

The market turmoil has forced retailers to scramble to secure supplies from rice packers so that their shelves are not bare.

"Some modern trade operators have had to cut their credit line from [the usual] 60-90 days to a seven-day deal to get more rice," Mingkwan said.

That will be good for suppliers, as they can have more working capital to further their business, he said.

Although the Kingdom is the world's largest rice exporting country, Thais have had to shoulder increases of 80-100 per cent in the cost of a five-kilo bag of jasmine rice. White rice prices have also followed the same direction.

Dealing with the rising cost of goods is Mingkwan's top priority.

He has had to rearrange his schedule to lead Thai officials on visits to trading partners, including in the Czech Republic, Poland and France.

He also met recently with the Gulf Cooperation Council - comprising the United Arab Emirates, Qatar, Kuwait, Oman, Saudi Arabia and Bahrain - to talk about supplying rice and other farm goods to the Middle East.

Mingkwan said Thailand was set to export nine million tonnes of rice this year.

The problem is that shipments abroad have been quite huge, averaging one million tonnes per month during the first quarter.

"With luck, we hope we can export more than nine million tonnes if we have enough rainfall," he said.

The second rice crop, to be harvested in May, is expected to bring 4.2 million tonnes to the market, he added.