Philippines Seeks to Buy 25% More Rice from Suppliers

The Philippines asked suppliers to ship 25 percent more rice than contracted for purchases since November, an official said, as the nation seeks to avert food shortages after storms damaged last year's harvests.

The state-run National Food Authority, which has bought about 1.8 million metric tons of the grain since November for delivery this year, used its options to order an additional 450,000 tons, Marketing Director Romeo Jimenez said today.

"We haven't discussed any new tender because of the re- order," Jimenez said in a phone interview from Manila. The country may secure as much as 2.25 million tons if suppliers agree to sell at prices settled in the last quarter, he said. The volume is 7.4 percent of this year's global trade forecast by the U.S. Department of Agriculture at 30.35 million tons.

Rice prices have gained 21 percent in the past six months as storms damaged 1.3 million tons of crops in the Philippines and on concern India, the second-biggest grower, may become a net buyer this year. Companies that had won supply contracts from the National Food Authority may not agree to sell the additional volumes as prices have since climbed, forcing the Philippines to return to the market, Rakesh Singh, a trader at New Delhi-based Emmsons International Ltd., said by phone today.

"If that happens, they will be ready for another tender" of 500,000 tons, he said.

March-delivery futures advanced as much as 2.6 percent to $15.28 per 100 pounds on the Chicago Board of Trade and traded at $15.2 at 6:45 p.m. Singapore time. Prices surged to a record in 2008 as concerns over shortages prompted exporters including Vietnam and India to curb supplies, sparking food price riots from Haiti to Egypt.

The Philippines raised its budget for the Dec. 15 tender 21 percent to 18.525 billion pesos ($403 million), after prices surged, allowing the government to buy 586,554 tons from offers that day, the biggest purchase of four tenders last quarter.