ASEAN KEY DESTINATIONS
Show and tell for Thai rice plan
Thailand’s Commerce Ministry has ordered rice millers and traders to declare the amount of rice they possess.
The order is a preemptive measure against possible malfeasance by traders attempting to receive high payments for low-priced or imported paddy rice in the pledging scheme set to start on October 7.
Millers and traders in 32 provinces are subject to compliance with the order. The new scheme is promising 15,000 baht a tonne for white paddy rice and 20,000 tonnes for Hom Mali, 30 percent above current market prices and and along with those prices, an incentive to cheat.
Deputy Commerce Minister Poom Sarapol said the measure was aimed at preventing millers and traders from colluding with each other to pay farmers for pledging their grain.
The authorities must grant permission for rice to be transported, he said.
Yanyong Phuangrach, the ministry's permanent secretary, said the ministry would closely watch for rice smuggling along the border.
Imports of the crop are banned except for broken rice, which is imported for industrial use. Mr Yanyong admitted the high payouts in the scheme would make it tempting for participants to try to circumvent the law. Millers buying a tonne of paddy for 9,760 baht this week would make a profit of 53.7 percent by pledging the same grain at 15,000 baht under the scheme.
He expects the rampant substitution of inferior rice, as the government intends to mortgage all grains produced this season.
Meanwhile, a rice industry veteran has given advice for catching the cheats.
Niphond Wongtra-ngan, a former president of the Thai Rice Mills Association, said he disagrees with the plan, which kicks off about a month before harvesting of the main crop.
"Not much grain is harvested in October, as the bulk comes in November and December, but an estimated 2 million tonnes of paddy may be in the hands of millers for wrongful use in reaping higher payments from the scheme," he said.
The profit to be made is attractive enough for millers and officials to collude with each other, said Mr Niphond, who is also an adviser to former deputy prime minister Trairong Suwannakhiri. He said if the programme must be carried out, then officials should carefully examine grain quality.
"If the grains are dry or have a low moisture content, it can be assumed they are not from a fresh harvest, considering the recent heavy rains and flooding," he said.
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