Thailand sells 250,000 tonnes of rice to Iran

The Thai government has signed a contract to sell 250,000 tonnes of rice from its stocks to Iran, Thailand’s commerce minister said on Thursday.

The deal with Iran comes as Thailand steps up its efforts to sell its stockpiles and to make way for grain from coming crops. 

“It’s the 100 percent white rice grade and delivery is due to start in October,” Niwatthamrong Bunsongphaisan told reporters. Niwatthamrong said the rice was sold to Tehran on a cost and freight basis (C&F), but he declined to reveal the price and the total value. 

However, the price of 100 percent grade white rice was offered at $520 per tonne, free on board basis (FOB), traders said. Despite Western sanctions on Tehran, Niwatthamrong said there is no problem about Iranian payment as rice is classified as “food” item, which is excluded from the sanction list. A senior commerce ministry official said the deal was not a barter deal, but Iran would open a letter of credit and pay cash as usual. 

Traders and industry officials said the size of the deal with the Iranian government was not very big compared with what Iran normally bought. Iran used to buy around 1.2 million tonnes annually from Thailand, but the purchase dropped sharply after the sanctions. However, Tehran still bought rice indirectly via the Dubai port. 

Niwatthamrong also said he targeted to sell more rice in government deals with China, Malaysia, the Philippines and Indonesia. However, traders said they were sceptical about demand and prices as most of the targeted countries were believed to be well-stocked and could wait to buy fresh grain at cheaper prices later in the year when major producing countries started harvesting their bumper crops. 

Story: The Business Recorder




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