Thailand approves scheme to keep domestic prices low

Thailand’s Cabinet approved a plan yesterday to dip into the government’s rice stockpile to help keep domestic prices low as global food prices surge.

Thai Minister Samak Sundaravej said it would start selling 5kg bags of rice at 170 baht (US$5.37) each, compared with the current market price of about 200 baht.

“We will start in about two weeks,” Samak said, but without specifying how much of the country’s 2.1 million tonne stockpile would be sold to consumers. He also did not comment on who would qualify for the subsidized price.

Samak the government would buy rice from farmers to refill the stockpile.

“This should help bring down the overall market price for consumers,” he said.

The government purchases rice for its reserves to help sustain prices when they are low.

In a bid to allay fears that the country would curb exports to meet local demand, Commerce Minister Mingkwan Saengsuwan said on Monday that Thailand was not suffering a rice shortage and will continue to export the grain.

Some Asian countries, including India and Vietnam, have curbed rice exports to guarantee their own supplies.

Mingkwan the country was on target to ship 9 million tonnes of rice overseas this year.

Separately, World Bank president Robert Zoellick urged countries yesterday not to use export bans on food produce to deal with the food crisis.