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BIZCHINA> Top Biz News
Thai, Chinese firms clinch $1.2b deal on starch purchase
(Xinhua)
Updated: 2009-06-09 16:33

Five million tons of modified starch worth 40 billion baht ($1.16 billion) will be shipped to China over the next five years under a memorandum of understanding (MoU) recently signed in a major North China city between a Thai firm and a Chinese firm, Thai media reported Tuesday.

According to Bangkok Post online, the deal was secured during a visit to China by the Prime Minister's Office Minister Virachai Virameteekul, who joined the 100 delegates from northern Thai public, private and farming sectors to hold agricultural road shows in China's northern city Tianjin between June 4 and 8.

Rungroj Hemansuthikul, president of the Thai company Power Unity, was quoted as saying that the deal would help bolster domestic tapioca prices in the 2009/2010 season, when the government plans to replace the current price pledging scheme with a price guarantee program.

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Under the MoU signed by the company and Guangxi Ming Yang, a Chinese starch manufacturer, the latter agreed to buy one million tons of Thai modified starch per year for five years, starting from the 2009/2010 tapioca harvest, the report said.

One million tons of powdered starch accounts for about 12 percent of the 2009/2010 season tapioca production forecast of Thailand, which is the world's biggest exporter of tapioca products, occupying 75 percent of the global market.

Tianjin's road-show was the first of the five Thai government- backed road shows to be held respectively in major northern China cities, namely Tianjin, Beijing, Dalian, Shengyang and Xi'an.

Prime Minister's Office Minister Virachai said the government plans to penetrate markets in northern China by using Tianjin, a major municipality near capital Beijing, as a gateway to other major cities.

In related developments, Thailand's companies have also clinched another two MoUs with China to set up a distribution center for fresh and processed Thai fruits in Tianjin and other part of northern China.


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