Thai Govt To Continue Rice Pledging Next Year Despite Complaints

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Govt to continue rice pledging next year despite complaints

PETCHANET PRATRUANGKRAI

THE NATION

BANGKOK: -- Although rice exporters complain vociferously that pledging has damaged trading competitiveness, the government will prolong the policy next year to drive the price of white rice up to the target of US$800 per tonne.

Yanyong Phuangrach, permanent secretary of the Commerce Ministry, yesterday said the government would focus on continuing the measure as a method of promoting better incomes for farmers.

Despite the large volume of stockpiled rice, which could adversely affect exporters, the government will also consider a plan to promote trading with a limited impact on rice prices, he said.

The ministry announced that it would continue to release stockpiled rice to traders in the market. It will focus on releasing the commodity in small lots so as to avoid a negative effect on domestic prices at a time of higher demand from exporters, he added.

Yanyong declined, however, to give the exact volume of rice in the government's stockpiles.

The authorities will also emphasise government-to-government rice deals with partner countries in a further attempt to minimise the impact on domestic prices.

The government aims to get the price of white rice up close to its target of $800 a tonne, and to $1,200 for jasmine rice.

Yanyong said pledging in the 2011-12 main-crop harvest season and the second-crop harvest season this year had raised rice prices by about $50-$150 per tonne over the past year.

Currently, the price of new-crop jasmine rice is quoted at $1,073 per tonne, while the price of 100-per-cent white rice is quoted at $616.

The price of 5-per-cent white |rice is $606 per tonne, while the Vietnamese equivalent currently comes in at $420, and Indian rice |at $415.

According to the Thai Rice Exporters Association, exports have dropped continuously since late last year after the start of the pledging measure.

As of May 28, export shipments this year had dropped to 2.86 million tonnes, down 43.1 per cent from 5.03 million tonnes during the same period last year.

Exports in May alone fell to 610,157 tonnes, a year-on-year decline of 42.5 per cent from 1.06 million tonnes.

Meanwhile, after a recent meeting with Ivory Coast Trade Minister Dagabert Banzio, Commerce Minister Boonsong Teriyaphirom said Thailand had agreed to sell 200,000 tonnes of rice to the West African country this year under a government-to-government contract.

Ivory Coast needs to import about 930,000 tonnes of rice each year. Last year, more than 60 per cent of these imports were supplied by Thailand, mostly in the form of jasmine rice.

-- The Nation 2012-06-05

[Colin Yai]

Somebody is making a Mountain of dough here and I very much doubt its the farmers from what i've personally witnessed in my area (Buri ram).

[Ricardo]

Why are the government reluctant to tell people how much they've got in-storage ?

Obviously not because it's piling-up, and unsellable, without a hefty further-subsidy to the exporters.

[GentlemanJim]

Government to Government deals...ideal for making lots of cash on the side.

Who would have thought that any Government would have destroyed their number 1 export industry. Are there any rice farmers here that can comment on the true effects on Thai farming and their evaluation as to whether the Government can actually achieve a global price rise in rice to $800 per tonne. May be the farming forum would be best to enquire.

[OzMick]

IMHO somebody made a logic goof.

If Thailand withdrew completely from selling rice the price may well rise to $800/t, and hey we're sitting on a fortune!

Unfortunately as soon as they try to sell some of that rapidly deteriorating fortune, the price drops to lower than it was originally.

[lannarebirth]

Somebody is making a Mountain of dough here and I very much doubt its the farmers from what i've personally witnessed in my area (Buri ram).

Un huh. Just imagine the amount to be made in the futures market frontrunning this policy.

[Soupdragon]

Somebody is making a Mountain of dough here and I very much doubt its the farmers from what i've personally witnessed in my area (Buri ram).

Un huh. Just imagine the amount to be made in the futures market frontrunning this policy.

Exactly. An accurate analysis of the winners and losers from this scheme may explain why it was implemented and now continued despite the fact it isn't doing what the government claim was the objective.

[Colin Yai]

Somebody is making a Mountain of dough here and I very much doubt its the farmers from what i've personally witnessed in my area (Buri ram).

Un huh. Just imagine the amount to be made in the futures market frontrunning this policy.

Exactly. An accurate analysis of the winners and losers from this scheme may explain why it was implemented and now continued despite the fact it isn't doing what the government claim was the objective.

I am smack bang in the middle of the "rice bowl" ,every one here in my village and surrounding district grows rice including all my wifes family and many relatives , the highest price on offer here was 14,000 a tonne for Homali fragnant rice with one instance of 16,000 baht , I have heard that you could obtain 18,000 but had to wait quite some time to draw your money which is still short of the so called guaranteeing price of 20,000 , unfortunately many farmers do not have the luxury of time as nearly all here are up to their necks in debt ,and that members is the simple truth of the matter ,,in closing I live only 22 kms to the Cambodian border were I heard wagon loads of cheap rice were slipping "through the net" to 2 well known local Thai Chinese rice merchants ,of course I dismissed this out of hand as just "local gossip"

[renaissanc]

Somebody is making a Mountain of dough here and I very much doubt its the farmers from what i've personally witnessed in my area (Buri ram).

Un huh. Just imagine the amount to be made in the futures market frontrunning this policy.

Exactly. An accurate analysis of the winners and losers from this scheme may explain why it was implemented and now continued despite the fact it isn't doing what the government claim was the objective.

I am smack bang in the middle of the "rice bowl" ,every one here in my village and surrounding district grows rice including all my wifes family and many relatives , the highest price on offer here was 14,000 a tonne for Homali fragnant rice with one instance of 16,000 baht , I have heard that you could obtain 18,000 but had to wait quite some time to draw your money which is still short of the so called guaranteeing price of 20,000 , unfortunately many farmers do not have the luxury of time as nearly all here are up to their necks in debt ,and that members is the simple truth of the matter ,,in closing I live only 22 kms to the Cambodian border were I heard wagon loads of cheap rice were slipping "through the net" to 2 well known local Thai Chinese rice merchants ,of course I dismissed this out of hand as just "local gossip"

The farmers will wake up one day to see how Thaksin has been taking advantage of their lack of education and trust in him. Thaksin needs to come back soon; otherwise, there will be so much opposition to him that his return will be impossible.

[JohnAllan]

Should we be surprised by anything this government does?

Higher farmer's incomes at the expense of Thai competitiveness could make sense only to politicians with something to gain from such an anomaly. Might as well give the farmers a direct subsidy from tax and let market forces dictate the price of the rice crop.

[bigbamboo]

Government to Government deals...ideal for making lots of cash on the side.

Who would have thought that any Government would have destroyed their number 1 export industry. Are there any rice farmers here that can comment on the true effects on Thai farming and their evaluation as to whether the Government can actually achieve a global price rise in rice to $800 per tonne. May be the farming forum would be best to enquire.

Who would have thought any government would choose a leader who doesn't know the difference between a parliamentary bill and a shopping bill.

[waza]

How does artificially inflating the market price of rice help the average Thai consumer?

[rubl]

The ministry announced that it would continue to release stockpiled rice to traders in the market. It will focus on releasing the commodity in small lots so as to avoid a negative effect on domestic prices at a time of higher demand from exporters, he added.

In other words the local consumers will continue to have the misconception to be paying high and/or higher prices. Their taxmoney used to keep prices high and the Ministry of Commerce using taxmoney for low-cost food fairs. At least soon all farmers will be rich I guess and able to help those who are not.

Anyone with any idea how much is spent on rice price pledging since October 7th 2011, how much of that has reached farmers and the total amount of rice in the growing mountain ?