RICE STOCKPILE (Request for Statement)

Mr William Tan asked the Minister for Commerce and Industry if he will make a statement regarding the rice stockpile.

Mr J. M. Jumabhoy: Mr Speaker, Sir, I am glad to avail myself of this opportunity to make a statement on the rice stockpile though I am sure that most of what I am going to say is already well known to hon. Members.

The stockpile of rice is part of the Singapore defence scheme and is maintained in the island to cover an emergency. I am sure hon. Members will appreciate that it is imperative that Government should be in a position to issue rice to the public and to the essential services in the event of any emergency either here or in the rice producing countries which results in a temporary shortage of rice. I might add here in passing that the Federation of Malaya also holds a similar stockpile.

The basic principle behind the stockpile is to ensure that adequate supplies of fresh rice are always available. It is necessary therefore that the stockpile be rotated and this is achieved by requiring importers of rice for local sale to purchase a certain amount from the stockpile on a ratio depending on the grade of rice. The ratio is two to one for imported whole-grain rice and three to one for broken rice.

It will be readily seen that the whole success of this stockpile scheme is dependent on regular rotation of the stockpile to ensure freshness of the rice. A new scheme has been introduced recently which aims at a minimum off take from the stockpile of 2,500 tons per month. This will operate for a trial period of four months. Most importers of rice have individually undertaken to draw from the stockpile up to a total of 2,500 tons a month. The principal association of rice importers in Singapore has also collectively guaranteed that offtake would not fall below the minimum figure of 2,500 tons per month. This measure of co-operation by the trade will assist both the trade and the Government.

As a concession to those importers of whole grain Thailand rice who have given this undertaking, they will be permitted to import up to three times the quantity which they have undertaken to purchase from the stockpile. Hon. Members will observe that the effect of this concession is to lower the stockpile obligations of the importers from two to one for whole grain and three to one for brokens to a flat rate of three to one. Additional imports from Thailand and from other sources will be subject to the normal stockpile requirements.

I should conclude here by repeating that the stockpile is operated strictly on a "no profit no loss" basis.

Mr William Tan: Sir, can the Minister give us the percentage of rice which has deteriorated in the stockpile? I was told that as some of the rice could not be moved out, a very large quantity deteriorated.

Mr J. M. Jumabhoy: As far as I know, there has been no large scale deterioration of rice but deterioration could have set in if Government had not taken this action to keep the stockpile moving.

Mr Lim Cher Kheng: Can the Minister explain why although the price of Chinese rice imported is cheaper by about ten cents a katty it is not included in the stockpile?

Mr J. M. Jumabhoy: Sir, the preference of the consumers in Singapore has always been expressed for Thailand rice and Government has always bought for the stockpile a bigger quantity of Thailand rice. In fact after I became Minister for Commerce and industry I tried to introduce other rice, that is, Burma rice and Saigon rice, and we had trouble with importers here who were forced to take the other grades of rice. However, we are slowly putting into the market rice besides Thailand rice but still the greater bulk of rice that Government holds is Thailand rice because of the strong consumer preference. China has only recently entered into the rice market and the quality of the Chinese rice, I am afraid, is still unknown to the Government as to its keeping qualities, and so on and therefore Government has not thought of buying China rice up to now.

Mr Tan Siak Kew: Can the Minister inform us of the quantity of the stockpile and the proportion of Saigon rice to Thailand rice taken from that stockpile?

Mr J. M. Jumabhoy: I have the figures of the stockpile holdings but I am afraid that it would not be right for me to disclose those figures as stockpile holdings are secret. However, the quantity of Saigon rice released in proportion to Thailand rice depends on the quantity of holdings of Saigon rice by the Government stockpile. For the moment, we have about 4,000 tons of Saigon rice and since it was of an earlier import date, we wanted to release this quickly before it could deteriorate. However, we came to an agreement with the merchants only yesterday that they will get 80 per cent Saigon rice and 20 per cent Thailand rice, only for such a period until the Saigon rice is finished. I expect the Saigon rice will be finished in the course of the next month or so and then they will get mostly Thailand rice.