Manila, July 3 - The Philippines, the world's biggest rice importer, paid almost $550 a tonne for 1.5 million tonnes of rice it bought from Vietnam earlier this year, far more than initially estimated, documents seen by Reuters showed.
Contacted by Reuters on Friday, Agriculture Secretary Arthur Yap did not disclose how much the government had paid, but said the differential was not unusual for a government contract and that it was "a good deal at the time".
News the government paid almost 45 percent more for rice could pile more pressure on President Gloria Macapagal Arroyo's government, which has been buffetted by controversies over government contracts, including a $329 million telecommunications deal with China's ZTE Corp, cancelled after reports of kickbacks.
When news of the deal first broke in January, trade sources estimated the price at $380 a tonne, C&F, around the level rice cargoes were trading on the spot market, although government-to-government deals are often concluded at much higher rates because buyers want to guarantee supplies.
"It must have been an 'extraordinary' deal, that's why there's an extra premium," said Pablito Villegas, an agricultural economics consultant with the United Nations Food and Agriculture Organisation. "There is more to it than meets the eye."
The documents obtained by Reuters placed the deal at about $825 million.
Neither the Philippines nor Vietnam, the world's No. 2 exporter after Thailand, disclosed the pricing. Nearly all of the 1.5 million tonnes rice arrived in Manila by last month.
The documents from the National Food Authority (NFA) showed the country's grain import arm paid $549.50 a tonne, cost and freight, for 1.5 million tonnes of long grain white rice with grades of 5 percent, 15 percent and 25 percent brokens from Vietnam Southern Food Corp, Vietnam's largest rice exporter.
Vietnam's 5 percent broken variety was quoted between $380-$460 a tonne, free-on-board basis, in January-February, while the 25 percent grade was at between $330-$400, according to Reuters data. That compared to $400-$410 a tonne for 5 percent brokens and $300-$350 for 25 percent grade in December.
Freight cost should be anywhere between $25-$35 per tonne for shipments from Vietnam to the Philippines or even lower, traders said.
Manila opted for a government-to-government deal to secure the bulk of its rice imports this year to avoid a repeat of what happened in 2008 when a series of tenders by NFA helped push prices of the grain to a record $1,080 a tonne in April.
The Philippines spent $1.5 billion to import a record 2.3 million tonnes of rice last year, 1.6 million tonnes of which was supplied by Vietnam.