May 6, 2009

Thailand may hold a rice tender Wednesday to sell 3 million metric tonnes of old crop rice stocks to domestic traders, for exports.

According to a report by the U.S. Department of Agriculture, posted on the agency's Web site, buyers will have to take delivery from government warehouses within 30-150 days, depending on the quantity of rice bought.

Once delivery is taken, the buyers will have to export the rice within 45 days.

The USDA report added the Thai government was also expected to review the rice procurement program for the crop being currently harvested.

According to the report, the government may expand the intervention target from 2.5 million tonnes of paddy currently to 3.5 million-4 million tonnes, in a bid to shore up domestic prices.

The government has so far already bought 2 million tonnes of the current paddy crop.

In other grains, soybean prices are likely to remain higher, as fundamentals, such as continued Asian demand and shortfall in Argentine crop, are supportive of prices.

"Old crop soybean fundamentals remain strong and we expect further price gains in the near term," said a Barclays Capital analysts' report Tuesday.

U.S.-based grains analyst Tim Hannagan said the near-term technical resistance for Chicago Board of Trade July soybean contract was US$11.20 a bushel, adding the long-term resistance was US$12.25-US$12.50/bushel.

At 0701 GMT, CBOT July soybeans were 11.6 cents higher at US$11.12/bushel.