BANGKOK—Thailand, the world’s biggest rice exporter, will sell 1.1 million tons of stockpiled rice to foreign buyers as it makes room for rice purchased under a domestic buying scheme, the Commerce Ministry said.

The rice, part of a 2.1 million-ton government stockpile, may be sold through private, barter or government-to-government deals, Deputy Commerce Minister Banyin Tangpakorn said.

"We have to release some rice to make space for the new buying scheme which will buy up to 2.5 million tons from farmers," he said of the plan to prop up local prices.

Thai 100 percent B grade white rice, the benchmark for the physical market, fell to $830-$850 per ton on Wednesday from $900-$930 per ton last week, traders said.

"We will have no problem selling the 1.1 million tons because we have had several inquiries from rice importing countries," Banyin said, without naming the countries.

In Manila, an official at the Philippine government’s grain-importing arm told Reuters it had no plan yet to buy some of the 1.1 million tons from Thailand.

The Thai price is down nearly 20 percent from a high of $1,050 per ton on May 22, when many farmers rushed to sow more land than usual to cash in on climbing prices.

Thai paddy rice, the raw unmilled grain that farmers sell to millers, has fallen 40 percent in the last two weeks to 9,000 baht ($276) per ton from 15,000 baht, twice as steep a decline as the end-product milled rice.

The domestic buying scheme was announced on Wednesday after rice farmers threatened to blockade major roads into Bangkok on Friday to urge the government to halt the price slide.

Banyin said the 2.5 million tons would be purchased in June and July at a fixed price of 14,000 baht per ton.

The government traditionally keeps a stockpile of rice as a buffer to guard against crop failures, and as a mechanism to ensure a stable price for consumers and exporters.

The easing in rice prices is the latest sign of easing concerns about shortages of Asia’s staple food.

Farmers in Thailand and neighbouring Cambodia and Vietnam are all looking to harvest large rice crops in June and July, suggesting the near trebling of prices this year after export curbs by India and Vietnam might have been an over-reaction.

Leading importers such as the Philippines, whose aggressive buying at the start of the price rally pushed the market even higher, also appear to be waiting for the market to weaken before moving in to replenish stocks.

"The market was quiet with no fresh demand from overseas buyers, while supply is increasing," said one Thai exporter.

Vietnam, which vies with India for the mantle of the second biggest exporter, is looking at a 6 percent increase in its May crop, the year’s largest, and Cambodia has lifted export curbs as its worries in March about a domestic shortfall evaporated.

Hanoi has already said it expects to lift an export ban in July, but with a 3 percent duty to limit overseas sales.

Exporters and millers in Thailand, which normally gets around 4.2 million tons from an additional June crop, say the harvest is likely to be around 4.7 million tons as many farmers sowed more land than usual to cash in on the climbing prices.

However, with domestic fuel and fertilizer costs soaring because of climbing world oil prices, rice prices cannot fall too far before the farmers who borrowed heavily to finance the additional planting start to feel the squeeze.

Traders said the slightly weaker baht that has resulted from the last week’s political concerns was also adding to the decline in export prices, which are quoted in US dollars.