At least 19 retailers applied for no-bid contracts for rice, Koizumi says
At least 19 retailers have applied for the government's no-bid contract procedure to purchase stockpiled rice, farm minister Shinjiro Koizumi said Tuesday, raising hopes of rice prices finally going down.
Koizumi said during a news conference that the ministry is planning to sign contracts with retailers that have applied by Wednesday and hand them the stockpiled rice as early as Thursday.
The retailers are set to receive a total of 90,824 metric tons, or about a third of the 300,000 tons the government plans to release overall.
'The rice is on track to hit stores in the first week of June,' Koizumi said Tuesday.
Pan Pacific International Holdings, which operates Don Quijote stores nationwide, has applied to purchase 15,000 tons, while Rakuten, supermarket chain operator OK Corp. and a subsidiary of Iris Ohyama, a home appliance company, have applied for 10,000 tons each. Major retailer Aeon said Tuesday that it plans to purchase 20,000 tons of rice and have it for sale by early next month.
Companies with rice millers, such as sake manufacturers, have offered to polish the stockpiled rice, the farm minister said, amid concerns that the extra step could slow retailers down in selling the rice. The ministry will help match retailers with such companies, he added.
Koizumi said Monday that the government plans to release 300,000 tons of unpolished rice through a no-bid contract procedure and hopes to see the average supermarket price for a 5 kilogram bag of rice go down to around ¥2,000. The weekly average price hit a record ¥4,285 for a 5 kg bag in the week through May 18.
More rice will be sold to retailers if the 300,000 tons is not enough, Koizumi added on Monday.
'The next step will be to figure out how the rice can be sold at smaller shops and supermarkets,' he said Tuesday. 'I've told our rice task force that we may need to revise (restrictions) on no-bidding contracts within a week.'
For now, applicants for the no-bid contracts are restricted to major retailers that have a record of selling at least 10,000 tons of rice annually.
The stockpiled rice was initially auctioned off to the National Federation of Agricultural Co-operative Associations (Zen-Noh) and other distributors with the goal of lowering prices by increasing supply. But as prices continued to rise, the government switched to no-bid contracts after Koizumi replaced his predecessor Taku Eto over a rice gaffe.
Unlike auctions, which go to the highest bidder, no-bid contracts allow the government to sell the rice at a lower price. The ministry also decided to cut out the middleman and sell the stockpiled rice directly to retailers for faster distribution.
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