Thailand plans 2m more tonnes of Government-to-Government rice sales

[webfact]

Thailand plans 2m more tonnes of Government-to-Government rice sales
BY LARRY BANKS



BANGKOK: -- According to a report in the Bangkok Post, the Thai government plans to sell more than 2 million tonnes of rice this year on a government-to-government (G-to-G) basis.

But the country admits attempts to sell rice to Iran may hit problems because of escalating political conflicts in the Middle East.

Chutima Bunapraphasara, Commerce Ministry permanent secretary, said the government has a memorandum of understanding (MoU) with China for a million tonnes.

The Commerce Minister Apiradi Tantraporn said on December 3rd that the government was expecting to sign a deal to sell an additional 1 million tonnes to China. The announcement came after the ministry signed a deal to sell a million tonnes of rice to the China National Cereals, Oils and Foodstuffs Corporation, a state-owned conglomerate. The deal was part of a 2 million lot for which Thailand and China signed an MoU in December 2014.

The rice delivery includes 100,000 tonnes a month starting early this year.

Full story: http://ethailand.com/business-news/thailand-plans-2m-tonnes-of-g2g-rice-sales/1211/

-- eThailand 2016-01-07

[phoenixdoglover]

At what price?

[rubl]

from which year ?

[Ricardo]

"Old Deals for New ... Bring Out Your Dead Mature Old !"

It would indeed be interesting to hear the terms of the proposed deals, there may well be a clause insisting on new-crop rice, not 2-3 years old ?

[JOC]

>>Thai government plans to sell more than 2 million tonnes of rice this year on a government-to-government (G-to-G) basis.<< Quote

And I plan to win the lottery....................

[taff33]

Sell it to China and then they can sell it to North Korea,good idea?

[MaiChai]

You could say the drought and lack of rice harvests this year might help the government get its stockpile down, assuming its edible!

[billd766]

At what price?

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

[phoenixdoglover]

At what price?

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower.

[Skywalker69]

At what price?

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower.

Do you have a link to that?

[rubl]

At what price?

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower.

Actually the current government doesn't have a program for buying rice. They honored the commitments they inherited from the previous government that's all. Now stuck with rice of course.

The subsidy is just that, a subsidy payable to farmers with certain limitations. Nowadays farmers (try to) sell to millers and the like.

[Srikcir]

At what price?

The Nation 2015-12-03:

"She [Commerce Minister Apiradi Tantraporn] explained that under the new MoU signed today, Thailand will deliver 100,000 tonnes of rice per month at the price that will be in line with global levels at the time of delivery.... the rice would be sold to COFCO, or China National Cereals, Oils and Foodstuffs Corporation - one of China’s state-owned food processing holding companies."

[ratcatcher]

from which year ?

Rice, unlike whisky or wine does not age well.

But, you never know, with the creative marketing skills of some Thais, they may be able to select a particular year as a star seller.

" The 2012 Hom Mali, a complex, earthy classic with a hint of buffalo dung and bird droppings.

Goes well with a spicy pad krapow moo or gaeng khio wan gai."

[phoenixdoglover]

At what price?

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower.

Do you have a link to that?

Took me a while to get to a decent computer...

October 31, 2015 as reported in TVF:

Measures set to stop rice prices falling

BANGKOK: THE COMMERCE Ministry, in cooperation with the Thai Rice Exporters Association, has launched measures to prevent rice prices falling during the upcoming main-crop harvest.

The goal is to prevent white paddy rice trading below a range of Bt8,000-Bt8,500 per tonne, while the price of paddy jasmine rice should be maintained at no lower than Bt13,500.

Charoen Laothamatas, president of the association, said yesterday that its members had agreed to spend a combined Bt50 million to purchase 100,000 of jasmine rice from the market at about Bt26,000 per tonne to absorb supply from the market during the next four months.

ALSO...

To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season.

This should help absorb about 2 million tonnes of rice from the market.

[phoenixdoglover]

At what price?

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower.

Actually the current government doesn't have a program for buying rice. They honored the commitments they inherited from the previous government that's all. Now stuck with rice of course.

The subsidy is just that, a subsidy payable to farmers with certain limitations. Nowadays farmers (try to) sell to millers and the like.

You may have missed a few things... see my post above.

[rubl]

Probably at the world market price with perhaps a discount for bulk buying.

It depends as well on the type, quality and age of the rice in question.

Old rotten rice from the stockpile from 4 or 5 years ago will be sold for a lot less than the 2015 Hom Mali or organic rice.

Fortunately this government does not seem to be in the buyers rice market and paying prices at 40% above the market rates.

Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower.

Actually the current government doesn't have a program for buying rice. They honored the commitments they inherited from the previous government that's all. Now stuck with rice of course.

The subsidy is just that, a subsidy payable to farmers with certain limitations. Nowadays farmers (try to) sell to millers and the like.

You may have missed a few things... see my post above.

Thanks, I had indeed missed that news item.

It's from 2015-10-31

http://www.thaivisa.com/forum/topic/867030-measures-set-to-stop-rice-prices-falling/

http://www.nationmultimedia.com/business/Measures-set-to-stop-rice-prices-falling-30271977.html

Still, the government is not buying, the government is providing soft loans.

[phoenixdoglover]

Actually the current government doesn't have a program for buying rice. They honored the commitments they inherited from the previous government that's all. Now stuck with rice of course.

The subsidy is just that, a subsidy payable to farmers with certain limitations. Nowadays farmers (try to) sell to millers and the like.

You may have missed a few things... see my post above.

Thanks, I had indeed missed that news item.

Still, the government is not buying, the government is providing soft loans.

Indeed, that is where the big money is being spent (while relatively small amounts are going to direct purchase).

Depending on the definition of "soft loan", the net effect could be similar. The government will definitely spend money to offer rice farmers loans they could not otherwise secure. I would also speculate that there will be a high rate of default or delayed repayment for the government loans, as this seems to be a very common result in Thailand.

[rubl]

Actually the current government doesn't have a program for buying rice. They honored the commitments they inherited from the previous government that's all. Now stuck with rice of course.

The subsidy is just that, a subsidy payable to farmers with certain limitations. Nowadays farmers (try to) sell to millers and the like.

You may have missed a few things... see my post above.

Thanks, I had indeed missed that news item.

Still, the government is not buying, the government is providing soft loans.

Indeed, that is where the big money is being spent (while relatively small amounts are going to direct purchase).

Depending on the definition of "soft loan", the net effect could be similar. The government will definitely spend money to offer rice farmers loans they could not otherwise secure. I would also speculate that there will be a high rate of default or delayed repayment for the government loans, as this seems to be a very common result in Thailand.

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

[Skywalker69]

ASEAN will be a big problem for thai farmers.

[carstenp]

ASEAN will be a big problem for thai farmers.

Good commet , Can you inlight us a bit. How and why?

[phoenixdoglover]

Actually the current government doesn't have a program for buying rice. They honored the commitments they inherited from the previous government that's all. Now stuck with rice of course.

The subsidy is just that, a subsidy payable to farmers with certain limitations. Nowadays farmers (try to) sell to millers and the like.

You may have missed a few things... see my post above.

Thanks, I had indeed missed that news item.

Still, the government is not buying, the government is providing soft loans.

Indeed, that is where the big money is being spent (while relatively small amounts are going to direct purchase).

Depending on the definition of "soft loan", the net effect could be similar. The government will definitely spend money to offer rice farmers loans they could not otherwise secure. I would also speculate that there will be a high rate of default or delayed repayment for the government loans, as this seems to be a very common result in Thailand.

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

Did you miss the part where the government planned to purchase 100,000 tons in 2015-2016 at prices way above market?

[Skywalker69]

ASEAN will be a big problem for thai farmers.

Good commet , Can you inlight us a bit. How and why?

Now they can buy cheeper Cassava, rubber, rice, sugercanes from Laos, Cambodia, Vietnam. No need to buy from Thai farmers.

[rubl]

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

Did you miss the part where the government planned to purchase 100,000 tons in 2015-2016 at prices way above market?

Did you miss

"Charoen Laothamatas, president of the association, said yesterday that its members had agreed to spend a combined Bt50 million to purchase 100,000 of jasmine rice from the market at about Bt26,000 per tonne to absorb supply from the market during the next four months."

That's the members of the Thai Rice Exporters Association.

[phoenixdoglover]

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

Did you miss the part where the government planned to purchase 100,000 tons in 2015-2016 at prices way above market?

Did you miss

"Charoen Laothamatas, president of the association, said yesterday that its members had agreed to spend a combined Bt50 million to purchase 100,000 of jasmine rice from the market at about Bt26,000 per tonne to absorb supply from the market during the next four months."

That's the members of the Thai Rice Exporters Association.

Yes, correct. I misstated that aspect of it.

However, the program was announced by the Commerce Ministry as their initiative (and this happened after Somkid became Finance Minister and a set of actions were announced that had similarities to previous government initiatives).

Let's not be naive. The private sector is not going to buy rice at 2 times the market price and suffer a predictable significant loss unless they have some compensation for that loss. There is more to this rice buying initiative than just a few sentences in the Thai press. For example, if the rice buying is on a relatively small scale, 100 million baht, how will the recipients of this very generous program be selected? I can think of a few unsavory possibilities. Maybe the extra money will go to "favored" rice suppliers, as a classic "kickback". Or perhaps the major rice "middle men" will buy rice from themselves at a high price, with no money actually flowing to rice farmers; this would just be a "shell game", in which the money moves around, but there is no net market effect.

At any rate, my observation was essentially correct. The government has not given up on the idea that buying rice at inflated prices provides some kind of market benefit. And they've not explained it well (or the Thai press has fallen down on the job), as usual.

[rubl]

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

Did you miss the part where the government planned to purchase 100,000 tons in 2015-2016 at prices way above market?

Did you miss

"Charoen Laothamatas, president of the association, said yesterday that its members had agreed to spend a combined Bt50 million to purchase 100,000 of jasmine rice from the market at about Bt26,000 per tonne to absorb supply from the market during the next four months."

That's the members of the Thai Rice Exporters Association.

Yes, correct. I misstated that aspect of it.

However, the program was announced by the Commerce Ministry as their initiative (and this happened after Somkid became Finance Minister and a set of actions were announced that had similarities to previous government initiatives).

Let's not be naive. The private sector is not going to buy rice at 2 times the market price and suffer a predictable significant loss unless they have some compensation for that loss. There is more to this rice buying initiative than just a few sentences in the Thai press. For example, if the rice buying is on a relatively small scale, 100 million baht, how will the recipients of this very generous program be selected? I can think of a few unsavory possibilities. Maybe the extra money will go to "favored" rice suppliers, as a classic "kickback". Or perhaps the major rice "middle men" will buy rice from themselves at a high price, with no money actually flowing to rice farmers; this would just be a "shell game", in which the money moves around, but there is no net market effect.

At any rate, my observation was essentially correct. The government has not given up on the idea that buying rice at inflated prices provides some kind of market benefit. And they've not explained it well (or the Thai press has fallen down on the job), as usual.

You're still misstating, essentially, blamming others for your 'mis-understanding'

The current government never had the idea that buying rice at inflated prices was a good idea. They inherited the obligations for outstanding pledged rice, they inherited 18m tonnes of stored rice. They managed to get down to 13m - 14m tonnes. Why would they buy rice?

BTW the TREA has put aside 50 million Baht to buy upto 100,000 tonnes of Jasmine Rice. You post as if that's comparable with what the previous government 'supported'. Well the previous government bought a total of close to 70 million tonnes of paddy which after processing turns into about 49 million tonnes of rice. Pheu Thai party stated two months ago to have paid directly to rice farmers the sum of 870 billion Baht.

It would seem you mis-understood and are still trying to convince that the current government is about as bad as the previous government. Trying to convince this government will buy 100,000 tonnes of rice where they do not while ignoring the 49 million tonnes the previous government spent 870 billion Baht on.

Don't worry though, tbthailand still like you for your propaganda.

[phoenixdoglover]

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

Did you miss the part where the government planned to purchase 100,000 tons in 2015-2016 at prices way above market?

Did you miss

"Charoen Laothamatas, president of the association, said yesterday that its members had agreed to spend a combined Bt50 million to purchase 100,000 of jasmine rice from the market at about Bt26,000 per tonne to absorb supply from the market during the next four months."

That's the members of the Thai Rice Exporters Association.

Yes, correct. I misstated that aspect of it.

However, the program was announced by the Commerce Ministry as their initiative (and this happened after Somkid became Finance Minister and a set of actions were announced that had similarities to previous government initiatives).

Let's not be naive. The private sector is not going to buy rice at 2 times the market price and suffer a predictable significant loss unless they have some compensation for that loss. There is more to this rice buying initiative than just a few sentences in the Thai press. For example, if the rice buying is on a relatively small scale, 100 million baht, how will the recipients of this very generous program be selected? I can think of a few unsavory possibilities. Maybe the extra money will go to "favored" rice suppliers, as a classic "kickback". Or perhaps the major rice "middle men" will buy rice from themselves at a high price, with no money actually flowing to rice farmers; this would just be a "shell game", in which the money moves around, but there is no net market effect.

At any rate, my observation was essentially correct. The government has not given up on the idea that buying rice at inflated prices provides some kind of market benefit. And they've not explained it well (or the Thai press has fallen down on the job), as usual.

You're still misstating, essentially, blamming others for your 'mis-understanding'

The current government never had the idea that buying rice at inflated prices was a good idea. They inherited the obligations for outstanding pledged rice, they inherited 18m tonnes of stored rice. They managed to get down to 13m - 14m tonnes. Why would they buy rice?

BTW the TREA has put aside 50 million Baht to buy upto 100,000 tonnes of Jasmine Rice. You post as if that's comparable with what the previous government 'supported'. Well the previous government bought a total of close to 70 million tonnes of paddy which after processing turns into about 49 million tonnes of rice. Pheu Thai party stated two months ago to have paid directly to rice farmers the sum of 870 billion Baht.

It would seem you mis-understood and are still trying to convince that the current government is about as bad as the previous government. Trying to convince this government will buy 100,000 tonnes of rice where they do not while ignoring the 49 million tonnes the previous government spent 870 billion Baht on.

Don't worry though, tbthailand still like you for your propaganda.

You're getting creative, rubl.

I never stated the current government was "about as bad" as the previous government. Those are your words.

I simply pointed out the current government is involved in a smaller scale ("significantly lower") rice buying effort, in which the prices being paid are much higher than market prices.

As everyone familiar with the previous government's rice scheme knows, a major element of the losses was due to this sort of price differential. Further, those higher prices and massive buying efforts did little to prop up global prices. It turned out that Thailand did not have a corner on the market.

So the obvious question is why would the current government promote this on a small scale given the widespread criticism of the previous scheme and its ineffectiveness? It makes little sense to do so.

Finally, why would you interject tbthailand into this discussion between you and me? Please don't confound his views and mine. We may overlap some, but that is all.

[rubl]

You're moving off target. Let's return to your post I replied to originally

"Actually, this government does have a program for buying rice above the market price. It's just their spending fervor that is significantly lower."

The government hasn't have a program for buying rice, the government had a program for soft loans to "To help farmers, the government earlier came up with a measure to allocate Bt26.42 billion to provide soft loans for them to stock rice in their barns during the harvest season."

Furthermore the government stopped selling from it's 13 - 14m tonnes stock inherited from the previous government for a moment.

Did you miss the part where the government planned to purchase 100,000 tons in 2015-2016 at prices way above market?

Did you miss

"Charoen Laothamatas, president of the association, said yesterday that its members had agreed to spend a combined Bt50 million to purchase 100,000 of jasmine rice from the market at about Bt26,000 per tonne to absorb supply from the market during the next four months."

That's the members of the Thai Rice Exporters Association.

Yes, correct. I misstated that aspect of it.

However, the program was announced by the Commerce Ministry as their initiative (and this happened after Somkid became Finance Minister and a set of actions were announced that had similarities to previous government initiatives).

Let's not be naive. The private sector is not going to buy rice at 2 times the market price and suffer a predictable significant loss unless they have some compensation for that loss. There is more to this rice buying initiative than just a few sentences in the Thai press. For example, if the rice buying is on a relatively small scale, 100 million baht, how will the recipients of this very generous program be selected? I can think of a few unsavory possibilities. Maybe the extra money will go to "favored" rice suppliers, as a classic "kickback". Or perhaps the major rice "middle men" will buy rice from themselves at a high price, with no money actually flowing to rice farmers; this would just be a "shell game", in which the money moves around, but there is no net market effect.

At any rate, my observation was essentially correct. The government has not given up on the idea that buying rice at inflated prices provides some kind of market benefit. And they've not explained it well (or the Thai press has fallen down on the job), as usual.

You're still misstating, essentially, blamming others for your 'mis-understanding'

The current government never had the idea that buying rice at inflated prices was a good idea. They inherited the obligations for outstanding pledged rice, they inherited 18m tonnes of stored rice. They managed to get down to 13m - 14m tonnes. Why would they buy rice?

BTW the TREA has put aside 50 million Baht to buy upto 100,000 tonnes of Jasmine Rice. You post as if that's comparable with what the previous government 'supported'. Well the previous government bought a total of close to 70 million tonnes of paddy which after processing turns into about 49 million tonnes of rice. Pheu Thai party stated two months ago to have paid directly to rice farmers the sum of 870 billion Baht.

It would seem you mis-understood and are still trying to convince that the current government is about as bad as the previous government. Trying to convince this government will buy 100,000 tonnes of rice where they do not while ignoring the 49 million tonnes the previous government spent 870 billion Baht on.

Don't worry though, tbthailand still like you for your propaganda.

You're getting creative, rubl.

I never stated the current government was "about as bad" as the previous government. Those are your words.

I simply pointed out the current government is involved in a smaller scale ("significantly lower") rice buying effort, in which the prices being paid are much higher than market prices.

As everyone familiar with the previous government's rice scheme knows, a major element of the losses was due to this sort of price differential. Further, those higher prices and massive buying efforts did little to prop up global prices. It turned out that Thailand did not have a corner on the market.

So the obvious question is why would the current government promote this on a small scale given the widespread criticism of the previous scheme and its ineffectiveness? It makes little sense to do so.

Finally, why would you interject tbthailand into this discussion between you and me? Please don't confound his views and mine. We may overlap some, but that is all.

Twist and turn and still unable to admit that the current government does not have a program to buy rice. The rest is distraction and obfuscation. Nice try to be negative.