Government to continue cheap rice SALES all year, warns millers of action

"The government will sell our low-priced rice until this year-end, when the rice price is more stable and affects consumers less, after the main harvest season starts," Commerce Minister Mingkwan Sangsuwan said yesterday.

The ministry has warned rice millers to purchase from farmers at fair prices, otherwise it will step in and buy directly from farmers itself.

The ministry said there was no reason to shore up rice prices as demand in the world market is still healthy.

The Cabinet on Tuesday widely discussed the ministry's bagged-rice campaign, especially whether it directly benefits the farmer.

It also suggested that the ministry focus more on government-to-government contracts for rice exports. Then, the government could use the profits to spend on other activities.

The government this week offered 100,000 5-kilogram bags of rice at a below-market price to consumers nationwide. They were quickly snapped up.

It will soon distribute 200,000 more bags to the market and release further supplies in the remaining months.

The price for the first batch was set at Bt120, but for following lots, the price may vary depending on the market.

The ministry found that the cheap-rice project did not cause problems for packers, but did effectively reduce the cost-of-living burden on consumers, particular low-income earners.

The ministry will expand the project to other kinds of rice such as jasmine, but regular white rice will remain as the main product as it accounts for 85 per cent of the nation's consumption.

The cheap rice came from the government's stocks of 2.1 million tonnes, of which 1 million tonnes are white rice and 300,000 tonnes jasmine rice, with the rest fragrant, sticky and other varieties.

Mingkwan said the government rice reserve would be maintained for the affordable-rice project as well as national security.

The government will today decide on how to sell the new rice crop, bought directly from farmers, to other governments, which have expressed strong interest in ordering Thai rice.

Today's meeting will finalise the paddy price to pay farmers, which is Bt19,000-Bt20,000 per tonne for jasmine rice, Bt14,000 for regular white rice and Bt9,000 for sticky rice.

The government already has requests for 6.7 million tonnes from many governments, including those of East Timor, Malaysia, Nigeria, Benin, Liberia, Hong Kong and Sri Lanka.