Thailand
Thailand: G-to-G deals for rice in the works
China and Indonesia are in the mix for planned rice sales in the form of government-to-government (G-to-G) deals during the remaining months of the year.
According to Commerce Minister Sontirat Sontijirawong, Thailand is waiting for the Chinese government to sign a contract to buy an additional 1 million tonnes of rice this year as part of an investment package that includes the initial high-speed rail project and sales of 2 million tonnes of rice and 200,000 tonnes of rubber agreed earlier.
Thai officials and their Chinese counterparts signed a memorandum of understanding (MoU) in December 2014 for 1 million tonnes each of old and new grains, along with the 200,000 tonnes of rubber. The MoU was part of the Thai-Sino high-speed rail deal.
Thailand has already signed a 1-million-tonne contract for delivery this year.
The government plans to sell rice to Indonesia after that country recently announced an auction to import an additional 500,000 tonnes. Indonesia imported 1 million tonnes at the beginning of 2018.
In a related development, Thai rice exporters won an auction to supply 215,500 tonnes of 25% white rice to the Philippines, accounting for 85% of the total contract up for bid.
After the Philippines’ National Food Authority announced the general rice auction for an additional 250,000 tonnes on May 22, five Thai exporters joined the auction.
Four of the exporters — Capital Rice, Asia Golden Rice, Thai Hua (2511) and Ponglarp — won the auction to supply 212,500 tonnes of rice, due to be delivered in July and August.
The remaining contract for 37,500 tonnes was awarded to Olam International Ltd of Singapore.
The price of 25% white rice is US$436 (13,926 baht) a tonne.
Last month, Thailand won an auction to supply 120,000 tonnes of white rice under a G-to-G deal with the Philippines at $517.50 a tonne.
The Philippines held an auction to import 200,000 tonnes; Vietnam won the right to supply the remaining 80,000 tonnes at the same price.
“This auction win will increase Thai rice export volume and maintain its market share in the Philippine market, while farmers will gain benefits from a stabilising price with more export orders,” Mr Sontirat said.
From January to May 22, Thailand exported 4.276 million tonnes of rice, up 2.6% year-on-year, with a value of $2.182 billion, up 23.3%.
Key export markets were China, South Africa, Indonesia and the Philippines.
Thailand aims to export 10 million tonnes this year.
Global rice demand remains strong and prices have held up well. For example, the price of 100% hom mali fragrant rice is copy,225 a tonne, up from copy,150 in the last two weeks. The price of 5% white rice is $450 a tonne.
Separately, the Commerce Ministry will discuss with rice exporters and millers the preparations for the main rice crop, which begins in September-October.
An appropriate plan must be in place for stabilising prices if production increases.
Meanwhile, the last edible-grade rice auction went as planned after nine bidders proposed to buy all 43,700 tonnes at prices ranging from 6,000 to 22,000 baht a tonne.
The subcommittee on rice bidding will consider the prices next Monday, and the results will be submitted to the rice policy and management committee chaired by the prime minister for approval.
Source: https://www.bangkokpost.com/business/news/1472981/g-to-g-deals-for-rice-in-the-works