Manila may start tender for rice import rights next week

The Philippines' state grains agency may start the bidding process for private sector rice import rights next week, as it seeks to secure supplies to counter any risk of bad weather causing major crop damage. Angelito Banayo, administrator of the National Food Authority (NFA), told Reuters the private sector, which was allowed to buy up to 660,000 tonnes, could purchase rice from Vietnam, Thailand and Cambodia.
"We may publish the invitation to bid by next week, with actual bidding to be held 10 days after," he said in a phone interview on Thursday. The Philippines has firmed up plans to import 860,000 tonnes of rice this year, around third of last year's record purchases totalling 2.45 million, with the NFA to buy 200,000 tonnes.
The Southeast Asian country, the world's largest rice buyer in recent years, has set a limit of 1.3 million tonnes this year, as it forecasts a 10 percent rise in domestic unmilled rice output to a record 17.4 million tonnes for 2011. Banayo was "quite comfortable" with an import volume of 1.3 million tonnes, but is worried about the weather conditions.
"I don't want us to be unprepared," Banayo said. "I'm worried about the possibility of a considerable reduction in production in case we are hit by a strong typhoon or we have a wet summer." The government wants the 860,000 tonnes of rice to arrive between late May and the start of the lean season in July.
Agriculture Secretary Proceso Alcala said on Wednesday the NFA would buy its 200,000 tonnes of rice from Vietnam in a government-to-government deal. The NFA's buying this year is markedly lower than the 2.2 million tonnes it bought for 2010, and Banayo said the grain agency wanted to buy "at very close to the actual market prices."
"Definitely, we will buy at lower than last year's prices," he said. In Vietnam, traders said the 25 percent broken rice often bought by the Philippines was between $410 and $430 a tonne, free-on-board Saigon Port, unchanged from Wednesday but down from $440 a tonne last week. They said there was a slight increase in domestic prices after news on the government-to-government deal between the Philippines and Vietnam. Traders said they have not heard of any price indications from Vietnam Southern Food Corp, or Vinafood 2, which is in charge of handling rice exports for the Philippines.