The Commerce Ministry will open bidding for 375,000 tonnes of rice next week in a move to deplete its stockpile before the second crop is harvested next month.

The move came after the National Rice Policy Committee, chaired by Deputy Prime Minister Trairong Suwankhiri, last Friday instructed the ministry to set up conditions for releasing its rice stock.

"The ministry will draft clear conditions for this round of bidding, to ensure the rice stock is sold to support exports, as well as have a minimum effect on the market price of rice," said a senior ministry source.

The ministry had to cancel bidding last month, because it was not satisfied with the offers made.
The source said the ministry should open bidding next week before the second crop of rice was harvested, in order to ensure that releasing the government stocks did not force down the prices.

Moreover, the government should be able to set clear regulations for price depreciation and negotiate its trading contracts with four countries.

The government will base the depreciation of the prices in accordance with the number of years the grain has been stocked. For instance, one-year-old rice will be depreciated 5 per cent, or by US$25.96 (Bt861), per tonne. The price of rice stocked for two years will be reduced 15 per cent ($77.88) per tonne, three years by 30 per cent ($155.76) a tonne and four years by 50 per cent ($259.59) a tonne. Rice that has been stocked for more than five years will be subject to more than 50-per-cent depreciation and sold only as feed meal.

The government earlier planned to depreciate the price by only $10 a tonne per year of storage.
Meanwhile, the ministry yesterday released reference prices for rice in the final round of its stock guarantee for the day's trading.

Permanent secretary Yanyong Phuangrach said the reference price for white paddy rice was set at Bt9,886 a tonne, from a guaranteed price of Bt10,000 a tonne, which means the farmers will have to be compensated Bt114 a tonne.

The reference price for jasmine rice was set at Bt14,796 a tonne, while its guaranteed price was Bt15,300 a tonne, which means the farmers would have to be compensated Bt504 a tonne.

Yanyong said the government would proceed with guaranteeing the price for the second crop, which will be harvested next month. However, the government may need to reconsider the harvest due to the brown planthopper infestation.

Source: The Nation