The Commerce Ministry plans a gradual release of its rice stocks next month in a bid to clear them out before the new main crop arrives in November.

Permanent secretary Yanyong Phuangrach said the Foreign Trade Department was studying strategies for releasing the stocks to increase supply in the market.

"Rice prices are expected to stabilise soon, because the end of the second crop's harvest and effects from the drought have resulted in a reduced supply of rice," he said.

The National Rice Policy Committee last week ordered the ministry to release the rice stocks.

It costs the government more than Bt800 million a month to store the 5 million tonnes of rice.

To stabilise prices, Yanyong said the ministry would release small lots into the market, so as not to pull down domestic prices.

Deputy Prime Minister Trairong Suwankhiri expressed confidence releasing the rice would not pull down prices. Only 1 million to 2 million tonnes will be released and without a specific time frame.

"If releasing the rice does start to pull down prices, the government will suspend the plan," he said.

Early next month, the government will host a workshop to formulate a strategy for releasing the stockpile and strengthening the Kingdom's export competitiveness. The Commerce and Agriculture ministries will participate, as well as exporters, millers and farmers.

With Vietnam, Thailand's major rice export rival, focusing on low-priced exports, the Kingdom should promote a greater variety of rice, Yanyong said, adding the Kingdom should focus on its strength by exporting premium grade rice.

The Internal Trade Department said domestic paddy rice prices shored up slightly to between Bt7,800 and Bt8,000 a tonne, from between Bt7,600 and Bt7,800 before.

The export price for 100percent white rice was quoted at US$471 (Bt15,200) per tonne last Wednesday, up from $469 early this month.

Source: The Nation