February 13, 2012

In a bid to lower production costs in some farm sectors, the Commerce Ministry has authorised the Public Warehouse Organisation (PWO) to bring in corn from a neighbouring country, the Bangkok Post reports.

It expects to spend THB700 million (US$22.7 million) to import 86,300 tonnes of corn from either Laos or Cambodia for sale to small farmers in the swine and egg sectors at below the market price of THB7 (US$0.23) a kilogramme.

Commerce Minister Boonsong Teriyapirom believes the imports will result in cheaper food prices but not hurt local corn growers.

The additional amount will be imported only occasionally and not be counted as quota shipments, which must enter the country between March and July each year.

Sarawut said the PWO, a state enterprise under the Commerce Ministry, is shouldering more than THB400 million (US$12.98 million) in accumulated losses to date, mostly to support the government's farm price intervention scheme.

To reduce its losses, the agency will streamline its packaged rice operations by adding 200 more sales agents nationwide. They will distribute PWO rice at the competitive price of THB110 (US$3.57) per five kilogramme pack.

Sarawut said this price is competitive with private companies, which earlier announced they would raise their retail prices by 5-10% in the second quarter. The state agency also plans to rent out space in its warehouses in Bangkok.

It recently signed a contract to lease warehouse space in Rat Burana and Thon Buri districts to the Government Pharmaceutical Organisation.