The Philippines, the biggest buyer of rice in Asia after China, will rerun a tender to buy 500,000 metric tons or seek supplies from another government after prices offered today were above-budget.
While the National Food Authority received offers for as much as 750,000 tons in the tender, the prices ranged from $460 a ton to $496.75 a ton, according to data from the agency. That’s more than the authority’s budget of $456.50 a ton for the sale. Four traders including Vinafood I and II of Vietnam, Louis Dreyfus and LG International Corp. had submitted bids.
Supplies of the staple are needed before the end of next month, according to Presidential Assistant for Food Security Francis Pangilinan. Philippine stockpiles fell 12.2 percent to 2.03 million tons as of July 1 from the previous month, good for 59 days, according to the agricultural statistics agency. National Food’s stockpiles are good for 14 days, Rex Estoperez, a spokesman, said before the auction.
“We will just have to ensure we will be able to bring in the volume of imported rice before end of September,” Pangilinan said in a statement today. “We will either do a rebid or government-to-government negotiation.”
The Southeast Asian nation may import 1.6 million tons in the 12 months ending June 2015, making it the world’s fourth-largest buyer. Purchases will be the most since 2010, according to U.S. Department of Agriculture data.
World inventory is poised to climb to the most in nine years in 2014 as production increases, the United Nations’ Food & Agriculture Organization estimates, helping cool advances in prices. Benchmark Thai prices were $447 a ton for the 5-percent grade on Aug. 20, up from $384 at the end of May.
National Food set a budget of 10.27 billion pesos ($235 million) for today’s tender, expecting 40 percent of volume to be delivered before Sept. 30.