February 22, 2014 00:00
By Petchanet Pratruangkrai
Denies Indonesian claim of cheap sales or breaching world trade rules
The Foreign Trade Department yesterday dismissed reports that Thailand dumped cheap rice on the world market – a move that could be a breach of World Trade Organisation rules.
The United States and some Asian nations have sounded warnings at the WTO because of Thailand’s alleged lack of transparency on rice sales and stocks.
Thailand has a glut of 18 to 20 million tonnes in state stockpiles bought via the pledging scheme.
An Indonesian trade official pointed to “indications” that Thai suppliers were dumping rice in that country.
Foreign Trade chief Surasak Riangkrul denied yesterday that the government had sold rice cheaply in the global market.
Thailand had sold rice to Indonesia under a government-to-government deal, but the price was not below the market price, despite what had been alleged, he said. Moreover, the deal was not a recent one and the government had not sold rice to Indonesia in the past year, he added.
“Thailand has sold rice at the market price and has never offered Indonesia or other countries rice at very low prices,” Surasak said. He added that the department would investigate the reports, and it may need to ask the Indonesian Embassy in writing about the case.
When asked about a move by the US, Cambodia and Vietnam against Thailand at the WTO, Surasak said officials would have to wait to see whether those countries filed a case. No country
had done that at the world trade body so far, he stressed.
However, the USA Rice Federation did write to the US Trade Representative in October 2012 to express fears that Thailand would eventually dump rice on the global market.
It expressed concern about the Thai rice-pledging scheme and the effect it may have on increased production and eventually on exports, if all the stored rice were to be released onto the market.
The federation urged the WTO to investigate Thailand’s compliance with anti-dumping rules.
Surasak said Thailand stood ready to prepare information and documentation to explain its position to the WTO if a price-dumping case were to ensue.
Meanwhile, Bachrul Chairi, director-general of foreign trade at Indonesia’s Trade Ministry, said there were signs that Thai suppliers were dumping rice in Indonesia as the Kingdom offloads its record stockpile on an already oversupplied global market, the Jakarta Globe reported.
“There is an indication that Thai rice suppliers dumped their rice exports in Indonesia,” he told reporters, without providing details of volumes or companies.
“They sell their rice to Indonesia at lower prices,” he said.
Asian rice exporters and producers will come under pressure with millions of tonnes of cheap Thai rice set to flow into the market when the controversial subsidy scheme ends later this month and farmers elsewhere offload their March harvest.
According to the Thai Rice Exporters Association, the price of Thai rice in the world market was still higher than that quoted by other rice-producing nations
The Phnom Penh Post reported that rice buyers were holding out as they anticipated a fire sale of cheap rice flooding the market. So Cambodia and other countries are taking the hit.