BANGKOK (REUTERS) - The Thai government said it could start shipping rice from its huge stockpiles to China by early 2014 under an agreement covering the sale of one million tonnes per year made during a visit by Chinese Premier Li Keqiang to Bangkok last weekend.
Thai Prime Minister Yingluck Shinawatra said on Sunday that China would support plans by domestic firms to buy a million tonnes a year for an indefinite period, an increase on an earlier commitment to take the same volume over five years.
Traders had reacted with some scepticism because they have seen no evidence to back up earlier government claims to have sold significant amounts to China and other countries.
"We (Chinese and Thai officials) will work out the details by November and I think we could start shipping the first lot of rice to China by early next year," Thai Commerce Minister Niwatthamrong Boonsongphaisan told reporters on Tuesday.
Traders said China used to import around 300,000 tonnes of rice from Thailand each year and there was no sign of erratic weather that could damage its crop substantially and force the authorities to import up to a million tonnes more per year.
Data from the Customs Department showed Thailand exported 137,029 tonnes to China from January to August this year, and just 95,595 tonnes in the same period in 2012, when it managed to sell only 176,213 tonnes in the full year.
The Thai government is desperately seeking to sell some of its rice stocks to get money to fund its intervention scheme, under which it pays farmers way above the market price.
Global demand is thin and supplies are on the rise, so traders say the government will inevitably have to accept big losses by selling at market prices. It does not give price details for rice sold from the stockpiles.
The government admitted initial losses of 136 billion baht (S$5.4 billion) relating to the 2011/12 crop, the first under the current scheme, but they could go much higher as the high intervention price has been maintained while market prices have slipped.
The size of the government stockpiles is uncertain, the picture muddied by conflicting figures given by ministers and doubts about deals the authorities claim to have made.
The most recent figure from the Commerce Ministry puts stocks at 16 million tonnes.
As a comparison, Thailand used to export around 10 million tonnes a year before the intervention scheme made its rice far more expensive than grain from rivals such as India and Vietnam. It shippped just 6.9 million tonnes in 2012.