Warning On Rice Policy A Wake-Up Call For Thai Govt

[Baerboxer]

"Government Spokesman Wim Rungwattanajinda said the government and Yingluck had not been informed properly and sufficiently about the scheme's operation by the Commerce Ministry with regards to three key areas - the quantity of rice in government custody, the stock in custody resold to buyers, and the amount of money spent under the scheme."

I can sense a few people being moved to inactive posts very soon.

You can't blame the poor PM. So busy with all these travels aimed at raising even more loans to be used wisely. How can she be expected to know everything? Bless.

Oh but wait, isn't the PM supposed to manage all these things, make sure everything is in order? Maybe time to move over for big sister's show?

[Thai at Heart]

"Government Spokesman Wim Rungwattanajinda said the government and Yingluck had not been informed properly and sufficiently about the scheme's operation by the Commerce Ministry with regards to three key areas - the quantity of rice in government custody, the stock in custody resold to buyers, and the amount of money spent under the scheme."

I can sense a few people being moved to inactive posts very soon.

You can't blame the poor PM. So busy with all these travels aimed at raising even more loans to be used wisely. How can she be expected to know everything? Bless.

Oh but wait, isn't the PM supposed to manage all these things, make sure everything is in order? Maybe time to move over for big sister's show?

Knowing 3 numbers to answer some specific questions is obviously too much.

Bet she knows the price of a Louis Vuitton handbag though.

[chiangmaikelly]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

Edited June 6, 2013 by chiangmaikelly

[chiangmaikelly]

The Vietnam Food Association has set a floor price for 25 per cent broken grain at US$365 (Bt11,1100) a tonne and cut the floor for 35 per cent broken rice by 1.4 per cent to $360 a tonne, Vietnamese traders said. The new floor prices are on a free-on-board basis. The Yingluck government buys from farmers at a minimum price of $500 per tonne,

making sales to foreign buyers even more difficult.

Even my six year old daughter could work out the maths on this ...surely to gawd someone in the government can see where this will end????

You have the supply side figured out given the demand does not change. But the demand could change eh?

[rubl]

In a way I'm willing to believe the government is trying but unable to come up with the correct figures. I had hoped though that administration within the government had improved along the lines of the requirements for banks.

In 1998 or 1999 a foreign bank held a due diligence at FBCB (First Bangkok City Bank) as part of a possible take-over. The bank didn't give them much info, not because they didn't want to co-operate, but simply because they couldn't. They didn't have the data requested. The foreign bank gave up and FBCB was taken-over by (i.e. moved into) KTB.

[whybother]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

What are you doing comparing oil to rice? Oil doesn't rot or get infested by rats.

Your analogy might be a little bit relevant if all the rice was on good storage. It isn't.

[smedly]

It could be argued that no money has been lost since the government still own some (most) of the rice. If you buy 1000 mangos at 100 baht each then sell 999 at 1 Baht each you have not made a loss until you sell the final mango.

accounting practice rules that moody's use means that the remaining stock must be valued at the current market price - so the asset remaining stock has a value - and as it remains in storage that value decreases

500 billion baht - rice bought from farmers at 15k per tonne - current market value 7k per tonne is about 260 billion roughly speaking and they have still got to sell it from storage before it rots

[slapout]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

The price of a commodity, rice in this case, is worth what the buyer will pay upon taking control of same. There does not seem to be a rice shortage in Asia nor on the world market, so its basically a buyer market. The buyer determines the quanity, quality and when/how he takes delivery. Realistlly Thai rice in storage is woth nothing and unlike oil, is subject to spoilage. Add the high cost of storage (800 baht/month/ton reported by one official), and its better to compare the rice program to any commodity that generates zero income, is subject to spoilage, theft, etc while real profit potential is dropping at an alarming rate due to unrecoverable cost, when/if the commodity is purchased in the future.

[drdoom6996]

Maybe this is the thing that brings Thailand down in the face of the world. Thank you PTP.

[drdoom6996]

The Vietnam Food Association has set a floor price for 25 per cent broken grain at US$365 (Bt11,1100) a tonne and cut the floor for 35 per cent broken rice by 1.4 per cent to $360 a tonne, Vietnamese traders said. The new floor prices are on a free-on-board basis. The Yingluck government buys from farmers at a minimum price of $500 per tonne,

making sales to foreign buyers even more difficult.

Even my six year old daughter could work out the maths on this ...surely to gawd someone in the government can see where this will end????

You have the supply side figured out given the demand does not change. But the demand could change eh?

Will won't, do you have a clue? Or just nothing to do today.

[waza]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

Ah CMK, the Don QuixoteI of TVF, I have been waiting in anticipation for you to post, and you haven't disappointed me. Your latest confabulation is pure genius and succinctly defends the logic of the rice scam and therefore the honour of the fair maiden, Yingluck. Its not about the mathematics its all about the illusion.

[chiangmaikelly]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

What are you doing comparing oil to rice? Oil doesn't rot or get infested by rats.

Your analogy might be a little bit relevant if all the rice was on good storage. It isn't.

Gee, Whybother read my post! I wrote, "In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years."

Edited June 6, 2013 by chiangmaikelly

[chiangmaikelly]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

Ah CMK, the Don QuixoteI of TVF, I have been waiting in anticipation for you to post, and you haven't disappointed me. Your latest confabulation is pure genius and succinctly defends the logic of the rice scam and therefore the honour of the fair maiden, Yingluck. Its not about the mathematics its all about the illusion.

I would have posted sooner but I'm in trouble at home. I was telling my wife we should send Yingluck a thank you note for lowering the value of the Baht (rice scheme). She got upset and did not like my, "every cloud has a silver lining analogy." I have some investments in US dollars that I can't change.

Edited June 6, 2013 by chiangmaikelly

[bigbamboo]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

Lucky you don't have a rice farm then.

[thaicbr]

 

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

 

They can't answer a simple straightforward question about where it all stands because no one knows.

 

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well.  I put all the oil that I have pumped from the well into storage.  Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months?  I have a rice farm.  I put all the rice grown into storage.  Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months? 

 

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years. 

 

What are you doing comparing oil to rice?  Oil doesn't rot or get infested by rats.

 

Your analogy might be a little bit relevant if all the rice was on good storage.  It isn't.

Gee, Whybother read my post!  I wrote, "In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years."

Problem is..... it's already been a couple of years

Question. Where do they sell the rice WITHOUT incurring a loss?

On a side note I do hope they include the millions of baht spent on new storage warehouses. And the subsequent monthly fees they are paying the private warehouses to store the rice.

Sent from my i-mobile i-STYLE Q6

[khunken]

The amazing thing is that they really have no idea where it stands. None. Yet it's big enough to break them as it's all borrowed from a government owned bank which can't afford the loss.

They can't answer a simple straightforward question about where it all stands because no one knows.

It's possible that they "can't" answer because a lot has been stolen both money and rice.

I have an oil well. I put all the oil that I have pumped from the well into storage. Is the oil in storage worth the price of oil when I put it into storage or the price today or the price in 6 months? I have a rice farm. I put all the rice grown into storage. Is the rice worth the price of rice when I put it into storage or the price today or the price in 6 months?

In good storage the rice won't rot for a number of years even if the storage is not so good it will be OK for a couple of years.

In both cases, when you prepare your balance sheet, you value the commodity at it's market price which can be a one-day price or an average during the period.

For the oil, which doesn't deteriorate, you take the cost of storage into consideration. For the rice, as well as storage costs a small amount (rising) of deterioration would be required to be included.

Using the cost price to value an asset is Enron-style accounting.

[chiangmaikelly]

Question. Where do they sell the rice WITHOUT incurring a loss?

I don't think they do. The question is how much of a loss. No one knows. Unless there is major bad news like flood or famine or war they are going to sell at a loss.

[khunken]

Question. Where do they sell the rice WITHOUT incurring a loss?

I don't think they do. The question is how much of a loss. No one knows. Unless there is major bad news like flood or famine or war they are going to sell at a loss.

The Finance Ministry knows how much of a loss has already been incurred. They won't even tell the Commerce Ministry let alone the figurehead PM. It's a 'state secret' and it's pretty obvious why.

If this was a listed company, they would be de-listed and investigated for fraud.

[chiangmaikelly]

Question. Where do they sell the rice WITHOUT incurring a loss?

I don't think they do. The question is how much of a loss. No one knows. Unless there is major bad news like flood or famine or war they are going to sell at a loss.

The Finance Ministry knows how much of a loss has already been incurred. They won't even tell the Commerce Ministry let alone the figurehead PM. It's a 'state secret' and it's pretty obvious why.

If this was a listed company, they would be de-listed and investigated for fraud.

If they don't how much rice is in storage and what it is worth how do they know what the loss is?

[WilliamCave]

i sure hope they dont get that 2.2trillion loan it would be a disaster,,you know it dont you,,,,

Excuse my ignorance but how much is 2.2 trillion baht in US dollars and were is Thailand going to get it?

Sounds like a lot of money with high interests rates , and how does borrowing this amount of money affect an economy?

I my self I think of the credit card scenario , the more I charge and pay the minimum all I am doing is paying interest and if my dept. keeps going up I some day will not have the ability to pay the credit cards , hence bankrupt .

This is only my understanding of dept. I know it is a simple way to look at it.

[chiangmaikelly]

i sure hope they dont get that 2.2trillion loan it would be a disaster,,you know it dont you,,,,

Excuse my ignorance but how much is 2.2 trillion baht in US dollars and were is Thailand going to get it?

Sounds like a lot of money with high interests rates , and how does borrowing this amount of money affect an economy?

I my self I think of the credit card scenario , the more I charge and pay the minimum all I am doing is paying interest and if my dept. keeps going up I some day will not have the ability to pay the credit cards , hence bankrupt .

This is only my understanding of dept. I know it is a simple way to look at it.

Is the 2.2 trillion baht for the rice?

[Familyonthemove]

It could be argued that no money has been lost since the government still own some (most) of the rice. If you buy 1000 mangos at 100 baht each then sell 999 at 1 Baht each you have not made a loss until you sell the final mango.

Unless all your mangoes go rotten before you sell them ..... or the price drops to less than you paid.

[chiangmaikelly]

It could be argued that no money has been lost since the government still own some (most) of the rice. If you buy 1000 mangos at 100 baht each then sell 999 at 1 Baht each you have not made a loss until you sell the final mango.

Unless all your mangoes go rotten before you sell them ..... or the price drops to less than you paid.

Pro government people say none of the rice is rotten. Anti government people think all of the rice is rotten. So tell us; what percent of the rice in storage is rotten and not able to be sold?

[OzMick]

If they don't how much rice is in storage and what it is worth how do they know what the loss is?

Your analogy was flawed because they aren't growing rice and storing it, they are buying rice at more than it is worth, storing it with associated costs and depreciation of value as it deteriorates.

In that business model there is no upside, it's ALL loss. You continue to push that it is important to quantify that loss, difficult to do because of the many factors involved. Figures of hundreds of billions of baht are thrown about, everybody expects the losses will be huge, but that's alright because we don't know EXACTLY how huge? Get a grip.

This government has no legal right to WASTE taxpayers' funds. That is called accountability, and it's about time they were held accountable.

[chiangmaikelly]

If they don't how much rice is in storage and what it is worth how do they know what the loss is?

Your analogy was flawed because they aren't growing rice and storing it, they are buying rice at more than it is worth, storing it with associated costs and depreciation of value as it deteriorates.

In that business model there is no upside, it's ALL loss. You continue to push that it is important to quantify that loss, difficult to do because of the many factors involved. Figures of hundreds of billions of baht are thrown about, everybody expects the losses will be huge, but that's alright because we don't know EXACTLY how huge? Get a grip.

This government has no legal right to WASTE taxpayers' funds. That is called accountability, and it's about time they were held accountable.

I agree with you but how much? How much rice is in storage and what is it worth? You don't know how much the government has spent on the rice scheme. If you do tell us. It is not how much has been spent. It is how much has been spent less the value of the rice in storage and sold under the scheme.

[khunken]

Question. Where do they sell the rice WITHOUT incurring a loss?

I don't think they do. The question is how much of a loss. No one knows. Unless there is major bad news like flood or famine or war they are going to sell at a loss.

The Finance Ministry knows how much of a loss has already been incurred. They won't even tell the Commerce Ministry let alone the figurehead PM. It's a 'state secret' and it's pretty obvious why.

If this was a listed company, they would be de-listed and investigated for fraud.

If they don't how much rice is in storage and what it is worth how do they know what the loss is?

Why don't you read some of the other posts on this thread & you would have your answer.

[chiangmaikelly]

If they don't how much rice is in storage and what it is worth how do they know what the loss is?

Why don't you read some of the other posts on this thread & you would have your answer.

Why don't you quote it? I read the other posts. It's not there.

[thaicbr]

If they don't how much rice is in storage and what it is worth how do they know what the loss is? 

Your analogy was flawed because they aren't growing rice and storing it, they are buying rice at more than it is worth, storing it with associated costs and depreciation of value as it deteriorates.

 

In that business model there is no upside, it's ALL loss. You continue to push that it is important to quantify that loss, difficult to do because of the many factors involved. Figures of hundreds of billions of baht are thrown about, everybody expects the losses will be huge, but that's alright because we don't know EXACTLY how huge?  Get a grip.

 

This government has no legal right to WASTE taxpayers' funds. That is called accountability, and it's about time they were held accountable.

I agree with you but how much?  How much rice is in storage and what is it worth? You don't know how much the government has spent on the rice scheme.  If you do tell us.  It is not how much has been spent.  It is how much has been spent less the value of the rice in storage and sold under the scheme.

It would seem that the government do not know. So we can only try and summarize the purchases. Sales and losses by the numerous official statements by numerous officials. And it equates to a substantial loss.

I don't think anyone will ever see the true losses published.

Sent from my i-mobile i-STYLE Q6

[OzMick]

If they don't how much rice is in storage and what it is worth how do they know what the loss is?

Your analogy was flawed because they aren't growing rice and storing it, they are buying rice at more than it is worth, storing it with associated costs and depreciation of value as it deteriorates.

In that business model there is no upside, it's ALL loss. You continue to push that it is important to quantify that loss, difficult to do because of the many factors involved. Figures of hundreds of billions of baht are thrown about, everybody expects the losses will be huge, but that's alright because we don't know EXACTLY how huge? Get a grip.

This government has no legal right to WASTE taxpayers' funds. That is called accountability, and it's about time they were held accountable.

I agree with you but how much? How much rice is in storage and what is it worth? You don't know how much the government has spent on the rice scheme. If you do tell us. It is not how much has been spent. It is how much has been spent less the value of the rice in storage and sold under the scheme.

If I told you THB345,987,375,832.55 would you be happy? I doubt that figure is correct, I doubt the current government has any real idea - in fact they are telling so many lies, issuing so many rubbery figures, obfuscating and self-deceiving that the real figure probably never will be known. IT IS IRRELEVANT.

If it is THB100 billion is that acceptable? 200 billion? 300 billion? Just how much tax money is a government allowed to waste, and continue to waste?

[iancnx]

Quote:// The Vietnam Food Association has set a floor price for 25 per cent broken grain at US$365 (Bt11,1100) a tonne and cut the floor for 35 per cent broken rice by 1.4 per cent to $360 a tonne, Vietnamese traders said. The new floor prices are on a free-on-board basis. The Yingluck government buys from farmers at a minimum price of $500 per tonne, making sales to foreign buyers even more difficult.//

Absolutely no hope for Thailand here. Moody's have fired their customary passing shot across the bows. We are in for a bumpy few months.... I sense major changes afoot!