MANILA (Thomson Financial) - The Philippines, the world's biggest importer
of rice, declared Monday's bidding for 675,000 tonnes of the grain a failure
with the sole bidder, state-owned Vietnam Southern Foods Corp. or Vinafood II,
failing to meet requirements.
The Southeast Asian nation, which imports about 10 percent of its domestic
rice requirement, would probably hold another tender, said Ludovico Jarina,
deputy administrator of the government's rice importing agency the National Food
Authority (NFA).
The bidding was declared a failure after Vinafood was unable to provide a
bank guarantee.
Thailand, the world's largest rice exporter, earlier said it will not join
the bidding as its farmers and millers are anticipating fresh demand in the
market.
Jarina said the government can still afford to defer bidding for rice
imports and re-enter the market when prices of the grain have softened.
But additional volume should be secured before July for the country to be
able to comfortably ride out the lean months which run typically from July to
September, he said.
"We are not pressured to buy for now since our intention was only to buy for
the buffer stocks."
Jarina said the NFA is still exploring other means to secure the balance of
up to 2.7 million metric tonnes of rice the government has said it may import
this year.
So far, a total of 1.7 million metric tonnes have been secured, mostly from
Vietnam and Thailand.
The government is keen on tapping about 60,000 tonnes to 100,000 tonnes of
rice from Southeast Asia's Emergency Rice Reserve Fund and from the United
States.
Jarina said the Philippine government already received feedback from several
member countries of the Association of Southeast Nations that are willing to
export rice to the country.
The NFA will also hold a country-specific bidding for private sector
importers on May 9 for 163,000 tonnes of rice. The supply will come from China,
Thailand, India and Australia.
The country's imports this year have been driving up prices of rice in the
global market and analysts said prices will continue to soar with Nigeria
recently announcing it will import 500,000 tonnes. Suppliers are also
anticipating Iraq to announce its import requirements soon.
Jarina said, however, that rice prices should stabilize soon as some of the
major rice suppliers in the region, including Thailand, will start harvesting
new crop in the next few months.
At last month's bidding, the Philippine government paid an average of $1,135
a tonne for the 320,000 metric tonnes tendered by exporters, a hefty increase
from the average $700 per tonne in the March tender.
($1 = 42.35 pesos)
rocel.felix@thomsonreuters.com
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