Thai Company Fails To Take Full Delivery Of Rice Stocks

President Agri Trading Co., one of Thailand's largest rice exporters, has failed to take delivery of nearly 1 million metric tons of rice from a total of 1.78 million MT it had been awarded at an auction three years ago, the president of the state-run Public Warehouse Organization said Monday.
 
  "So far, only 700,000 to 800,000 tons of rice have been taken by the company," said Pisut Chalakornkul.  Pisut said the PWO has extended the period for taking delivery of the rice several times for the company, which blamed the delay on poor grain quality.
 
  He said the financial damage to the state was huge, as the PWO had to shoulder management and storage costs for the unclaimed rice. The company was the sole winner in bidding for the 1.78 million tons of rice
called by the Ministry of Commerce.
 
  The rice should have been collected by 2005, as the bid required all rice to be exported nine months after the contracts were awarded. "Some receiving schedules have been put off to June this year, but some lots
just have been neglected," Pisut said.
 
  The failure to ship the rice has also increased the state's rice stockpile to more than 4 million tons. According to Pisut, private legal experts would be invited to separately examine the more than 10 contracts for the 1.78 million tons of rice. They will look into the details of each contract to see whether the company has sold some
of the rice in the domestic market, which would be a breach of the contractual terms, or whether legal action could be taken against it.
 
  If breaches are found, President Agri could face a fine equal to 25% of the THB17 billion (US$489 million) value of the deal if it fails to export all of the rice.