Thai Govt Set To Sell Rice Below Cost In Secret Deals, Source Says

[Thai at Heart]

A rice-trader source said yesterday that a huge loss would be incurred if the transaction went through as the pledging cost of jasmine rice is above Bt32,000-Bt33,000 per tonne, but the government is expected to sell it at Bt29,000 a tonne.

I don't understand these numbers, the maximum price for jasmine is 20,000. Can it be that drying, processing and storage adds another 10 to 13k on top? Someone is gouging MASSIVELY in this calculation.

That was the whole reason for setting it up.

Well, if this is the calculation that is out in the public domain, there is absolutely no way they will get away with it, and if we know anything about corruption in this country, it is rarely as easy as this to spot. One of the millers who loses out on the deal will simply go to court and file a corruption case. It can't be that the cost of milling yield, packaging and other sundries is fixed at 12 to 13 baht per kilo i.e 400 USD per tonne. This stuff is processed on an industrial scale, with few labour, highly mechanised machinery and fast through put.

Thailand would never have been able to export anything, ever at this processing, cost. Something must be screwy with the numbers.

http://www.unescap.org/tid/publication/tipub2558_chap7.pdf

Lots to chew on here, but I can't believe it costs 12k/mt to get this stuff from the farmer to the port.

[rogerdee123]

So, two campaign promises that were extremely effective in getting votes from the rural population have been exposed as frauds. Both the tablets and rice pledging have been totally exposed as Ill considered plans made with no forward thinking or budgeting, with the only goal being to deceive the voters. Well done PTP.

I see where China has offered to loan Thailand enough money to carry out there one student one tab plan. Maybe they will take rice in payment.

Ha ha ... but don't be surprised if this happens ... in which case the Chinese tablets will be the most expensive tablets on the market.

[Crushdepth]

The source said his company held secret talks with the ministry in the middle of the month. The ministry had invited traders to make offers for the government's stocks.

And then they can resell it back to the government for a profit, under the rice pledging scheme.

[Ricardo]

One minor point, 500,000 tons is a piffling amount, when the government-stocks are (according to Thaksin in Singapore late-September) 4 million tons of milled rice & 17 million tons of paddy.

It will therefore make sod-all difference, to how much space is available, in the warehouses !

[Moruya]

Buy high, sell low and cream off the middle - welcome to Thailand, the only country where ths form of economics works.

'Tis only the red shirts that can't see who the losers are.

[drdoom6996]

The source raised concern that this kind of secret dealing could lead to corruption and lack of transparency.

COULD??

He must mean lead to more corruption. As if there is not enough already.

[mikebell]

We get our information from The Nation - translated from Thai? Do Thais get to read the original stories? If so why would any one vote for this Government again? Oh I forgot the vote-buying!

[cloudhopper]

But who is going to buy it from the traders at 29k per tonne? 935 USD per tonne?

500,000 tonnes at a 3,000 baht loss per tonne? 50mn USD? Can't add up......

They plan to make it up on volume.

[notmyself]

i would like to buy afew tonnes below cost and sell them back making use of the rice scheme.

Same here.

[belg]

excuse me? so the stocking of the rice is at the same price as the value of the rice? 15.000 (what the miller gets) + 15.000 (for stocking it ?)

[brianP]

What madness and shame, people are starving here and many places and the free market aint so. I hope every single baht is accountable.