Due to favourable external factors, Thailand is confident it can sell up to 10 million tonnes of rice overseas this year, which would go a long way in paring down its sizeable stocks.

"Due to rising concern over the (global) drought problem, as well as the low supply of rice in both domestic and overseas markets, the Thai government could sell a massive amount of rice from its stockpiles, and will continue to release more to clear up our huge stocks within two years, or by the end of 2016," Duangporn Rodphaya, director-general of the Foreign Trade Department, said yesterday.

The Commerce Ministry reported it man?aged to sell 1.14 million tonnes at the latest auction for 1.38 million tonnes - the best result in the eight rounds since the ministry opened bidding for its rice.

The government still holds about 14.3 mil?lion tonnes of rice, of which 4.6 million tonnes are rotten and will soon be offered for indus?trial use.

About 8 million tonnes have already passed standard testing and could be sold for domestic consumption and export.

With demand high in the world market, Thailand should be able to ship up to 10 mil?lion tonnes of rice abroad this year, as its rivals mainly India and Vietnam have faced drought crises and are slowing down their tenders.

Thailand could ship out 4.3 million tonnes of rice this year to June 23, while India export?ed 4.1 million tonnes and Vietnam 2.35 million tonnes.

Thailand should export more rice in the second half of the year as demand is strong during the drought.

With more demand in the world market, the export price of Thai rice improved by 5 per cent during the past two weeks.

To supply more stocks to the market, the ministry is planning to stage the next round of bidding by the end of this month.

This latest round is expected to generate up to Bt11.07 billion from 33 winners out of 55 bidders.

In the first eight rounds conducted by the current government, 3.88 million tonnes worth Bt40.94 billion were sold out of inven?tory.

However, the government is expected to lose about Bt55 billion from the auctions since its pledging cost was about Bt24,000 a tonne, while the average price from the bidding was Bt10,000 a tonne.

Source: The Nation