Thailand’s private sector is urging an increase in sales of the country’s rice stock through government-to-government (G-to-G) purchases. According to the Deputy Commerce Minister, growth in rice shipments can be as high as 3% in 2016 in the best case scenario. The government would need to increase G-to-G deals and increase exports of processed farm products.
The government announced earlier in the month that the goal is to sell 2 million tons of rice through G-to-G sales, with an additional 1 million tons being sold to China to honor a memorandum of understanding.
Drought in Indonesia and the Philippines have caused both countries to have interest in buying Thailand’s rice. Both nations expect to have a lower supply due to the drought, and the Commerce Ministry is hoping to sell 9 million tons of rice this year. In 2015, the ministry projected 10 million tons of rice to be sold.
The ministry missed their 10-million-ton goal, with reports in late 2015 indicating that only 8.27 million tons of rice was sold.
The government was able to earn 52.6 billion baht by selling 4.87 million tons of rice at auction, and earned 50 billion baht by selling 3 million tons of rice through G-to-G sales. There are currently 12 million tons of rice still in storage and categorized as Grade P, meaning that they pass the ministry certification. The rice is in slightly poor condition. There are also 6 million tons of rice rated as substandard which are suitable for industrial uses such as animal feed and ethanol.