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RP has option to buy another 62,500 T rice after tender

Reuters | 11/05/2009 12:52 PM

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MANILA - The Philippines has the option to buy another 62,500 tons of rice over the next 6 months at prices offered during Wednesday's state tender for 250,000 tons, a government official said on Thursday.

"Under the law, we are allowed to re-order 25% of the tendered volume," said Rex Estoperez, spokesman at the state-run National Food Authority.

"The prices are valid for 6 months and if prices at the tender are better than market prices 6 months from now, we can re-order," he said.

Korean trading firm Daewoo International Corp. gave the lowest bid of $468.50 a ton, cost and freight, to supply 100,000 tons of 25% broken white rice, from Thailand and Vietnam, for arrival between January and April.

Vinafood 2, Vietnam's largest rice exporter, submitted the second-lowest offer if $480 a ton, C&F, for 150,000 tons of the same rice grade for arrival in January.

Coming in third was Toepfer International Asia Pte Ltd which offered to sell 100,000 tons of rice from multiple origins at $534.99 a ton, C&F.

Vinafood 2 also bid to supply another 100,000 tons -- with delivery split between February and March -- at $537 per ton, the fourth-lowest offer.

Estoperez said NFA was "most likely" to award the 250,000 tons supply deal to Daewoo, at 100,000 tons, and Vinafood 2, at 150,000 tons after they gave the two lowest bids.

The Philippines, the world's biggest rice buyer, has imported 1.775 million tons of the national staple this year, lower than a record 2.3 million tons in 2008 which helped drive prices to record highs.

Of the 2009 total, 1.5 million tons was bought from Vietnam via a government-to-government deal.

Demand from the Philippines and other importers like Iraq and India are expected to keep rice prices firm through 2010.

But industry players say prices probably won't rise as much as they did in 2008 when export curbs by key producers drove up Thailand's benchmark 100% B white rice to an all-time peak of $1,080 per ton.