Measures set to stop rice prices falling

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.
“This amount of purchased rice will not be traded in the market, but will be stocked for three months to ensure that there is no oversupply during the harvest season,” he explained.
The measure should help guarantee that the price of paddy jasmine rice does not fall below Bt13,500 a tonne, and that farmers can get a profit of at least 15-30 per cent from their output, he added.
The association could consider increasing the overall purchase volume if it eventually found there was an oversupply problem, its chief said.
For white paddy rice, the ministry expects prices will be no lower than Bt8,000-Bt8,500 a tonne in the coming months, due to higher demand for white rice in many markets – mainly the Philippines, Indonesia and African countries.
Moreover, Commerce Minister Apiradi Tantraporn said the ministry would suspend its plan to release rice from the government’s stocks via auction during the harvest season from November to February, in a bid to prevent prices falling.
In the meantime, it will only consider selling rotten rice for use in the production of biomass or as base-material supply for energy production, she said.
About 16 million to 17 million tonnes of paddy rice are expected to be harvested during the main-crop harvest, well below the normal level of about 23 million tonnes due to the drought problems faced by farmers this year.
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.
Charoen also projected that Thailand should be able to export at least 9.5 million to 10 million tonnes of rice this year, and around 10 million tonnes next year.
With high demand in the market, the amount of rice in the government’s stockpile should be reduced to 5 million tonnes next year, he said.
With about 13 million tonnes currently held in the stockpile, the Commerce Ministry said that 1 million to 2 million tonnes could be sold this year under government-to-government contracts.