* Govt has spent $21.3 billion on buying rice
* State stockpiles are huge, exact size in doubt
* Stocks amassed through costly intervention scheme
By Apornrath Phoonphongphiphat
BANGKOK, Sept 25 Thailand may need to raise new
funds for a rice buying scheme in the crop year from October as
it has fallen behind schedule in repaying the state bank that
runs the scheme, bank officials say, showing the government's
failure to sell down stockpiles.
The government has been buying rice at prices way above the
market since October 2011. The policy, aimed at helping poor
farmers, has priced Thai grain out of export markets and cost
Thailand its crown as the world's top rice exporter.
Luck Wajananawat, president of the Bank for Agriculture and
Agricultural Cooperatives (BAAC), which funds the scheme, said
the government had spent 667 billion baht ($21.3 billion) on
buying rice since the scheme began.
The Commerce Ministry, which manages the rice scheme, has
repaid only 139 billion baht to the BAAC, Luck was quoted as
telling Thai newspapers on Wednesday, well short of the 220
billion the government aims to pay back by the end of the year.
"We are to finalise plans to borrow money to fund the scheme
in the next few days," Luck was quoted as saying on the website
of business newspaper Krungthep Thurakij, referring to the
authorities' need to renew funding.
A senior official at the BAAC, who asked not to be named,
confirmed the figures. "If the government wants to continue the
scheme, it will have to borrow billions of baht more as its
budget to run the scheme has run out," he told Reuters.
There was no immediate response from the government.
Prime Minister Yingluck Shinawatra has said the government
was not considering further loans because it would have enough
money from selling rice from its stocks to fund the scheme.
The cabinet has said it would spend no more than 270 billion
baht for the scheme in the year from Oct. 2013 to Sept. 2014.
Early this month, Commerce Minister Niwatthamrong
Boonsongphaisan said, "Since the cabinet has approved the budget
of 270 billion baht for the scheme, it is the duty of the
Finance Ministry to figure out how to get the money."
The BAAC source, who declined to be identified because of
the sensitivity of the issue, said, "The Finance Ministry will
need to guarantee another loan (from the BAAC) by the end of
By the government's own admission, the scheme incurred
losses of 136 billion baht in the 2011/12 crop year. Total
losses depend on the prices paid for the grain, the volumes
bought and sold and the price differentials. The government has
published minimal data on all these aspects.
SCEPTICISM ON STOCKS
Deputy Commerce Minister Nattawut Saikuar said in June that
stockpiles stood at 17 million tonnes.
On Sept. 12 Commerce Minister Niwatthamrong Bunsongphaisan
said stocks had dropped to 10 million and the government had
sold 1.2 million tonnes to China this month.
There has been no confirmation of that deal from China and
the Thai government has given no further details.
As with previous claims of government sales, traders and
industry officials will remain sceptical until they see evidence
from port activity and export statistics.
The government has stopped publishing monthly rice export
data since the intervention scheme started.
Data from the Office of the Rice Inspection Committee, part
of the Board of Trade of Thailand, shows just 2.25 million
tonnes exported in 2013 by Sept. 19, down from 3.47 million in
the same period last year.
Thailand exported a record 10.6 million tonnes in 2011 but
only 6.9 million in 2012 after the rice scheme drove up prices.
The United States Department of Agriculture has forecast
Thai stocks would be 12.5 million tonnes by the end of 2013.
In a bid to cut the stockpiles, the government has said it
would ease rules for future tenders, letting international
trading houses take part, for example. It sold only 240,000
tonnes in three tenders in July and August, after offering
($1=31.3250 Thai baht)
(Editing by Alan Raybould and Clarence Fernandez)