Cheap rice : 500 tons sold out in 1 hour

A government promotion for the retail sale of 100,000 five-kilogramme bags of rice selling at Bt120 (US$3.7) per bag sold out in just an hour on Monday, a senior Thai Ministry of Commerce official said Monday.

Each buyer was allowed to only three bags of rice, drawn from government warehouses nationwide, and sold at about 20 per cent less than the current market price.

Of the total 100,000 bags,18,250 were sold in Bangkok while the balance was distributed and sold in nine other provinces. The idea of selling packaged rice was initiated by the Commerce Ministry to cope with public demand for rice in the market following complaints that there was not enough rice for shopping malls.

People were lining up at rice sales outlets since 9am and the entire supply of 100,000 bags of rice were sold out within an hour, said Mr. Yanyong.

Disappointed rice buyers were allowed to place their signatures to book for future rice sales, scheduled for May 20 and May 30, when it will sell 100,000 bags of rice on each day, said Mr. Yanyong. (TNA)

What to think about it ?

First, the volume is ridicule. Thailand consumes 9,6 millions of tons of rice per year…

It’s a PR operation.

Second, when 33 000 persons (minimum) line in queue to save 30×3 = 90 THB (half the minimum daily wage in BKK)… and other people are “disappointed” because they were not served… then I’m not sure we can rejoyce ourselves.

But in a way, it’s a good reminder : the vast majority of the thai population has low income.

Look at the datas of average wages for employees (here).

This is why inflation is an explosive issue… much more than in western countries. The government is making a mistake by pushing on GDP growth instead of fighting inflation.

And fighting inflation DOES NOT MEAN to increase wages !

2 Responses to “Cheap rice : 500 tons sold out in 1 hour”

  1. 1 BangkokDan 14 May 2008 at 3:28 am

    A PR move it is, but still, “flooding”/surprising the market with cheap rice brought down prices and hurt speculators.

  2. 2 thaicrisis 14 May 2008 at 5:35 am

    Flooding ? Not yet.

    Well, the first speculator is… the state itself.

    The gvt just announced that it will buy -directly- at high price the rice from the farmers…

    My point : I’m not sure we can blame only the “speculation”. It’s going to last. It’s enough to see the several rice orders some countries continue to put (last example Malaysia).

    What the thai gvt (like many others) is doing is simply… to subsidize the local market of rice.

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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.

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