Concern over rice price

By Petchanet Pratruangkrai
The Nation
Published on August 14, 2008

The government will set the high¬estever intervention price of Bt15,000 a tonne for regular paddy rice and Bt19,000 a tonne for jasmine rice. Jasmine rice has gained popularity with farmers because of its high price in the market.

The higher intervention price increased concerns among exporters about Thai export competitiveness, as there is a high price gap between Thai rice and rice from other countries.

The high intervention prices may cause both market distortion and speculation problems.

Commerce Minister Chaiya Sasomsap said yesterday that high prices should ensure high incomes for farmers when the main rice crop enters the market, starting in November. "The government may increase the guaranteed rice price to above Bt15,000 a tonne, foreseeing high demand in the market," he said.

The government also plans to release its 3.5 million tonnes of rice stock to prepare space for the new stock. The stockpile will be directly sold to exporters this month.

Normally, the government releases rice stockpiles by opening an auction for exporters and millers. However, the Samak gov¬ernment has changed its policy to selling rice by negotiating.

To date, the government has 3.6 million tonnes of rice in its stockpiles, of which 2.1 million tonnes are from previous harvest seasons between 20042007, and about 1.5 million from this year's second crop.

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Concern over rice price

The government will set the high¬estever intervention price of Bt15,000 a tonne for regular paddy rice and Bt19,000 a tonne for jasmine rice. Jasmine rice has gained popularity with farmers because of its high price in the market.

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