Government declares rice auction ‘success’

Bids satisfactory but short of expectations

More than 200,000 tonnes of rice will be auctioned next week, following the first bid in two years of 60,000 tonnes two weeks ago.

The government disclosed the results yesterday of the first rice auction called by the Commerce Ministry, which drew five interested bidders. They were Thai Hua (2511), Capital Cereals, Asia Golden Rice, Ponglarp and Chaiyaporn Rice and Food Products.

Capital Cereals, Asia Golden Rice, and Chaiyaporn Rice and Food Products were the winners for a combined 60,000 tonnes of 5% white rice from six warehouses, said Commerce Minister Niwatthamrong Bunsongphaisan.

The government is also negotiating with Ponglarp, the only bidder for 30,000 tonnes of broken rice put up for auction on the same day.

‘‘The bid was satisfactory even though the prices fell short of our expectations,’’ said Mr Niwatthamrong, adding conditions of auctions may need to be amended to suit the demand of bidders.

The minister again refused to disclose the prices, saying only the auction fetched decent prices higher than the benchmark set by the committee that handled the government’s rice stock sales. He said disclosing the price would affect sales in future auctions.

However, a rice industry source said the winners might have proposed to buy the grains for under 12,000 baht per tonne. If this was the case, the auction would have realised losses worth 11,500 to 12,000 baht a tonne.

The losses are based on the government’s estimated spending on rice via its pledging scheme of about 24,000 baht per tonne.

The government announced on July 15 it was putting 550,000 tonnes of rice up for auction, with 5% white rice slated for export making up 150,000 tonnes, and broken rice for export and local use making up 200,000 tonnes.

Another 200,000 tonnes to be auctioned will be sold as paddy to be processed as parboiled rice for export.

The government allows interested rice bidders to file tender envelopes for 200,000 tonnes of paddy to be processed as parboiled rice for exports on July 30.

It is believed the state holds up to 17 million tonnes of unsold rice.

Commerce Ministry statistics as of July 25 show Thailand has shipped 3.6 million tonnes this year, a drop of 6.3% from 3.8 million in the same period last year. Export value also fell 1.9% over the same period to US$2.54 billion.

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