Commerce ministry ordered to scrap rice bids

Abhisit told Commerce Minister Porntiva Nakasai to hold another auction based on new regulations.

Porntiva had ordered the Public Warehouse Organisation to terminate the previous bidding even though contracts were already signed with the 17 winners, the source said.

The new round is expected to help minimise the government's losses under its pledging programme.

Earlier, the damage was estimated at several billions of baht, as the ministry planned to sell the 2.6 million tonnes of stockpiled rice at an average price of Bt14,200 to Bt15,500 a tonne, versus the market price of Bt16,500 to Bt17,000.

Porntiva, a key figure of the Bhum Jai Thai Party, a government coalition partner, was questioned during a Cabinet meeting on the dubious auction.

Deputy Prime Minister Korbsak Sabhavasu of the Democrat Party also cast doubt on the transparency of the bidding process.

Asia Golden Rice president Sombat Chalermwutinan said his company had been unofficially informed of the cancellation but had no plans to sue the government even though it would miss a business opportunity.

Ponglarb president Sompong Kitireanglarp insisted the government allow the firm to take delivery of its part of the rice inventory it won in the auction.

CP Intertrade president Sumeth Laomoraphorn said voiding the bidding results was not unusual, since the government was not happy with the prices quoted.

The firm would still join the next round of bidding called by the government, he said.