Thailand sold 300,000 tonnes of 15 percent broken grade white rice to Indonesia at lower-than-market prices, but the overall Asian market for the grain was quiet ahead of year-end holidays, industry and government officials said on Wednesday.
The Thai government sold the grain from government stocks to Indonesia's state procurement body, Bulog, for prompt shipment, industry and government officials said earlier in the day. "We resumed negotiations on the previous 300,000 tonne deal and finally agreed to sell," a Commerce Ministry official said.
In August, Thailand's Public Warehouse Organisation (PWO), a state-owned body that manages government rice stocks, said it had agreed to sell 300,000 tonnes to Indonesia. However, the deal was suspended after a new government took office later in August and said it needed to reconsider the sale since it was negotiated during a transition period.
Prices were on the rise at the time as the new government had promised to bring in an intervention scheme that guaranteed to pay farmers way above market levels for their rice. The ministry official declined to give further details about the price in the renegotiated deal.
However, traders close to the deal said the rice was sold at $559 per tonne, cost and freight basis (C&F). The previous deal was reported to have been tentatively agreed at $550 per tonne. The 15 percent broken grade rice was offered in the market at $550-$560 per tonne on Wednesday, free on board (FOB), equivalent to around $580 on a C&F basis. Other grades of Thai rice were steady at relatively high levels, with the benchmark 100 percent B grade being offered at $590 per tonne.
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