Rubber Trees

[Joe Walshe]

My wife hopes to plant rubber trees on 200 rai near Chaiayphum in Esarn. She plans to do this after Eucalyptus presently on land are harveted and stumps removed. Anyone out there got any ideas on profit on investment. OBviously it would help if we could predict rubber prices. I know that because of extensive planting in Vietnam and China rubber prices have been dropping. Any opinions from rubber farmers appreciated. Thanks. Joe

[jamescollister]

Joe

Before I started looking at returns from a rubber plantation I would be checking out the costs. 200 rai is a big investment. You will be payimg out for years and not just a few dollars here and there. You will need to buy a tractor, truck and tools before you even start. Fertiliser alone will cost around $10,000 to $15,000b us per year,never mind the cost of trees,labour etc.

If you are interested PM me and you can come over to have a look at my place near Buntrik { corner of Lao Cambodia} a long drive,but it may save you a lot in the long run.

JIM

[Joe Walshe]

Joe

Before I started looking at returns from a rubber plantation I would be checking out the costs. 200 rai is a big investment. You will be payimg out for years and not just a few dollars here and there. You will need to buy a tractor, truck and tools before you even start. Fertiliser alone will cost around $10,000 to $15,000b us per year,never mind the cost of trees,labour etc.

If you are interested PM me and you can come over to have a look at my place near Buntrik { corner of Lao Cambodia} a long drive,but it may save you a lot in the long run.

JIM

Thanks Jim.

Would love to pop over for a chat but living and working in Ireland at present so it would be an exceptionally long drive.

We have a mixed farm (40 rai) with 15 cattle, fish, rice, fruit trees etc. in Chumphae and are in the process of buying 200 rai in Chaiyaphum which has a 3y.o. Eucalyptus planatation on it. we are looking at what best to plant after we harvest the Eucalyptus. I would prefer not to have Eucalyptus at all and am keen to get rid of them.

After reading several posts today, I am keen on the idea of permaculture - that is planting a wide range of trees so as to have regular sustained income for my wife and for the kids to inherit. I realise this is labour intensive and therefore costly but if the return is good and I employ a bunch of locals and family it might be a good option.

The Chaiyaphum farm is not needed as we can live on the Chumphae famr with my pension. The Chaiyaphum farm is a bargain, which is why we are buying it.

Curious to know what you are doing over near Laos.

[kuma]

I am off to Buriram province today to look at an established planation. It is 22 Rai and apparently has trees already mature enough for harvesting. There seems to be no irrigation system, not sure if one is required in the area or not.

Of course I will have to check all the details, in particular who really owns the land and if they can really sell it and if it can really be used for this purpose etc etc. I was thinking if I can make a deal (they are apparently wanting 1.3M THB for the 22 Rai) then I can get the gf family set up to work it (they claim they know how and can) so they can become more independant.

A million potential pitfalls here but I think I will at least have a look to see what is there.

Anyone have a comment on that price or any other relevant information they can share?

Thanks

Joe

Before I started looking at returns from a rubber plantation I would be checking out the costs. 200 rai is a big investment. You will be payimg out for years and not just a few dollars here and there. You will need to buy a tractor, truck and tools before you even start. Fertiliser alone will cost around $10,000 to $15,000b us per year,never mind the cost of trees,labour etc.

If you are interested PM me and you can come over to have a look at my place near Buntrik { corner of Lao Cambodia} a long drive,but it may save you a lot in the long run.

JIM

Thanks Jim.

Would love to pop over for a chat but living and working in Ireland at present so it would be an exceptionally long drive.

We have a mixed farm (40 rai) with 15 cattle, fish, rice, fruit trees etc. in Chumphae and are in the process of buying 200 rai in Chaiyaphum which has a 3y.o. Eucalyptus planatation on it. we are looking at what best to plant after we harvest the Eucalyptus. I would prefer not to have Eucalyptus at all and am keen to get rid of them.

After reading several posts today, I am keen on the idea of permaculture - that is planting a wide range of trees so as to have regular sustained income for my wife and for the kids to inherit. I realise this is labour intensive and therefore costly but if the return is good and I employ a bunch of locals and family it might be a good option.

The Chaiyaphum farm is not needed as we can live on the Chumphae famr with my pension. The Chaiyaphum farm is a bargain, which is why we are buying it.

Curious to know what you are doing over near Laos.

[Issangeorge]

Kuma, I know nothing about rubber farming, but I am very interested in it myself and have been researching it on the net. I have had a hard time getting accurate figures. I have not read anything from a farmer in Issan with a producing farm, so it is very hard to get accurate yield per rai figures, but if you go to this site http://www.oae.go.th/statistic/yearbook/2003/indexe.html and then click trees and then Parra rubber you will see that in 2546 (2002) the average yield was 286kg/rai and it had been going up every year, also from other reading I have done this seems a low figure, so if you use this figure you are being conservative, but if the yield is not this there is a better chance it will be higher than lower, so this is probably a good figure to work with. As for price per kilogram, who knows? You can see from the table the price was as low as 22.64/kg and as high as 37.66/kg, but all those prices were before oil went up again. Today if you use 50 baht per kilo I think you are using a conservative figure. It is true that there are new rubber plantations in Vietnam, China, and Thailand, but there are also old ones being discontinued and remember as long as China and India grow there will be a need for more rubber and I don’t think there are enough new plantations to look after the growth, so 50 baht per kilo is probably a safe figure to work with.

Ok what do we have? Fifty baht per kilo and 286 kilos per rai equals 14,300 per rai. If your workers get half this still leaves you with 7,150 per rai. From all I have read for a producing plantation it should not cost more than 1,500 baht/rai for materials and probably a lot less, so that gives you a net of 5,650 per rai or 124,300 for 22 rai. If you pay 1.3 million baht for the plantation that gives you a return of 9.56%. That is a lot better than the banks will give you and remember these are conservative figures. I am guessing if I get any flames it will be because my figures are low. Also if you want to invest money in Thailand, land is always a safe investment, if you don’t mind not having it in your name. Also rubber goes the way of oil, so if you think oil will stay at present levels, or at least not go down, then rubber is a good investment. Issangeorge

[Mosha]

I did see a Discovery episode about rubber. 2 things stuck out.

1 It only grows well within 15 deg of the equator.

2 The world can't grow enough of the stuff. It's known as Malaysia's white gold.

When and if you do plant it it be prepared for a 7 or 8 year wait. I think current root stock prices are adout 10 Baht each, though I may be wrong.

[martaway]

I am interested to hear of any experiences growing rubber in Issan.

Traditionally rubber has been grown only in Southern Thailand.

Presumably the yields are a lot lower in Issan ?

[apetley]

My wife knows at least 2 people in Isaan trying to sell their rubber plantations because they say it's alot of work for the return.

Their plots of land are only 30 rai'ish though I believe. Maybe economy of scale would increase returns.

[kuma]

Hi george

Thanks for this message, sorry I did not have notification on and have only read it today.

I have gathered a bunch of info as well, most off the internet but also have some printed material. Let me know if you are still looking into it - if so I will dig the stuff up and get you the links.

I may be going to a village up your way (kalasin) in Jan for a wedding. Any hotel recommendations in that town? I think they may have ideas of us all staying in the village but I plan to drive up and would prefer a hotel myself

Thanks

k man

Kuma, I know nothing about rubber farming, but I am very interested in it myself and have been researching it on the net. I have had a hard time getting accurate figures. I have not read anything from a farmer in Issan with a producing farm, so it is very hard to get accurate yield per rai figures, but if you go to this site http://www.oae.go.th/statistic/yearbook/2003/indexe.html and then click trees and then Parra rubber you will see that in 2546 (2002) the average yield was 286kg/rai and it had been going up every year, also from other reading I have done this seems a low figure, so if you use this figure you are being conservative, but if the yield is not this there is a better chance it will be higher than lower, so this is probably a good figure to work with. As for price per kilogram, who knows? You can see from the table the price was as low as 22.64/kg and as high as 37.66/kg, but all those prices were before oil went up again. Today if you use 50 baht per kilo I think you are using a conservative figure. It is true that there are new rubber plantations in Vietnam, China, and Thailand, but there are also old ones being discontinued and remember as long as China and India grow there will be a need for more rubber and I don’t think there are enough new plantations to look after the growth, so 50 baht per kilo is probably a safe figure to work with.

Ok what do we have? Fifty baht per kilo and 286 kilos per rai equals 14,300 per rai. If your workers get half this still leaves you with 7,150 per rai. From all I have read for a producing plantation it should not cost more than 1,500 baht/rai for materials and probably a lot less, so that gives you a net of 5,650 per rai or 124,300 for 22 rai. If you pay 1.3 million baht for the plantation that gives you a return of 9.56%. That is a lot better than the banks will give you and remember these are conservative figures. I am guessing if I get any flames it will be because my figures are low. Also if you want to invest money in Thailand, land is always a safe investment, if you don’t mind not having it in your name. Also rubber goes the way of oil, so if you think oil will stay at present levels, or at least not go down, then rubber is a good investment. Issangeorge

[Issangeorge]

Kuma, in Kalasin Town, the there is a hotel that you can see from the Highway that is the closest you will come to a western style hotel Lao Pao (I think), but if you drive through its parking lot and go down the road you will see AP Garden and it has nice rooms for 350 baht a night, no restaurant though. Issangeorge.

[plachon]

Joe

Before I started looking at returns from a rubber plantation I would be checking out the costs. 200 rai is a big investment. You will be payimg out for years and not just a few dollars here and there. You will need to buy a tractor, truck and tools before you even start. Fertiliser alone will cost around $10,000 to $15,000b us per year,never mind the cost of trees,labour etc.

If you are interested PM me and you can come over to have a look at my place near Buntrik { corner of Lao Cambodia} a long drive,but it may save you a lot in the long run.

JIM

Thanks Jim.

Would love to pop over for a chat but living and working in Ireland at present so it would be an exceptionally long drive.

We have a mixed farm (40 rai) with 15 cattle, fish, rice, fruit trees etc. in Chumphae and are in the process of buying 200 rai in Chaiyaphum which has a 3y.o. Eucalyptus planatation on it. we are looking at what best to plant after we harvest the Eucalyptus. I would prefer not to have Eucalyptus at all and am keen to get rid of them.

After reading several posts today, I am keen on the idea of permaculture - that is planting a wide range of trees so as to have regular sustained income for my wife and for the kids to inherit. I realise this is labour intensive and therefore costly but if the return is good and I employ a bunch of locals and family it might be a good option.

The Chaiyaphum farm is not needed as we can live on the Chumphae famr with my pension. The Chaiyaphum farm is a bargain, which is why we are buying it.

Curious to know what you are doing over near Laos.

Very glad to hear someone mention permaculture and would wholeheartedly support your idea as being a sound one, but for one small detail........you're buying a eucalyptus plantation........by definition an exotic, monoculture, non-food crop. All those words run counter to the basic principles of permaculture and mean that you will have a lot of work ahead to convert 200 rai to native, biodiverse, multi-purpose tree and food crops.

It can be done, but it will be a very expensive and difficult task (for example, have you considered how you are going to remove the eucalyptus stumps?) and may dampen the notion you have purchased a "bargain". However, if you carry on with eucalyptus, you will be subject to the law of diminshing returns as the trees take more out the soil than you or they can return and the whims of a monopolistic market and carnivorous buyers. Again, the "bargain" may seem less rosy in long run.

Either way, I wish you luck with the venture and if you decide the permaculture route, do please keep us informed of your methods and observations. I for one, would be very interested to hear how it goes.

[Joe Walshe]

Plachon,

Thank you for your input.

I have been researching eucalyptus a lot in the past few days. To cut a long story short we have decided to sell the land before or after first cutting and selling the eucalyptus.

We recently purchased very good land (50 rai), with a spring, in Loei. It's on high ground with many trees in the area. We have been in discussions with local agri/forestry people and hope to plant a range of trees on it. We have been advised lime will grow well and can be a good investment. Other trees to be planted include Teak, Mango, Tamarind, Papaya, Bananna and alternative fast growing ttrees (alternative to eucalyptus). I don't have names of local indigineos trees here now.

We have been advised that chilli will grow very well between trees and is profitable. Bees (honey), ants (ant eggs) and mushrooms will also flourish.

Having read the Farming forum for over a year now I don't see retired Farangs making significant money farming unless they work hard. I work hard in Ireland and make more in a week than I might make in months of farming in Thailand.

Ultimatley, we don't need an income from farming and would be joining the hobby farming brigade. I would, however, like to think that the developed land would increase in value because of the trees etc. and our kids would have something to inherit. Will post a new thread giving more details once we know more.

Creating a pleasant environment with trees etc. is more appealing to me now even if Eucalyptus proved to be very profitable.

[charliedundee]

Hi all,

as i am about to aquire land in Karasin to farm rubber i was interested in all your comments.

Most of my research so far in farming has been financial so as to ascertain which, if any, farms would be profitable and i agree with Issangeorge's figures, in fact i have one friend who yields 4 kg per rai a day for 135 days a year and last week another friend sold rubber sold at 85 baht/kg which gives nearly 4000 baht a month per rai, also there is "exploiting" the tree which although reduces the life expectancy of the tree by about 5 years produces a third more rubber, then there is the relatively new strain of tree 'Rimm 251' which has reportedly been harvesting for the last 5 years an astonishing 140 % more than the existing 'Rimm 600' that 90 % of Thailand use at the moment.

I'm sure you can tell i am sold on rubber as it appears to be a very lucrative business but i would be interested in any negatives.

I am now looking into soil types etc. and would be interested if anyone has any good easy to understand( i am no farmer) links to this type of info ?

Cheers

Charlie

RUBBER_TREE_NUMBERS.xls

[Mosha]

Nice file Charlie. Just had a chat with my wife & son in law. Around here it's RIMM 251 that's grown now. However the locals still prefer to wait for 7 years. Cut for three days and rest for 1. Heck all I ever wanted as to supplement my pension. That file suggests the pension becomes pocket money Exploiting the tree here isn't an option due to a long wet season.

Edited December 29, 2007 by Mosha

[Issangeorge]

Charliedundee, Where did you get your spreadsheet from? I live in Kalasin in Kuchinarai are you anywhere near me? Issangeorge

[charliedundee]

Charliedundee, Where did you get your spreadsheet from? I live in Kalasin in Kuchinarai are you anywhere near me? Issangeorge

I made it myself. I live in Hua Hin but i am coming to Kalasin in a couple of weeks to check land out if thats any help

[charliedundee]

Having lived here 5 years i foolishly forgot what ex-pats were like as i shared my information on this forum. 25 of you downloaded my spreadsheet without reply, needless to say i will not share any more info, which is a pity for you as most of you seem to not have a clue.

Being a parasite is not a virtue.

[stoneman]

Charley..

Do not be too hasty to criticize this group...There are a lot of experienced farmers on this board with a lot of experience in Thai farming. I was the "26th" downloader of your spreadsheet and I must say that I am very impressed with your work...Obviously a lot of thought and preparation...

I currently have 4,000 rubber trees ranging from 2 to 5 1/2 years old and we are negotiating to buy another 42 rai and put that to rubber trees.. It now has 4 rai of eucalyptus trees which we may let stand or may clear...They are less than 1 year old. Also have 67 avocado trees(1 to 4 yrs old), which will start bearing fruit this year...not a lot the first year, but something..

Thanks for your postings and look forward to hearing more about your venture...

Stoneman

[chang35baht]

Hiya Charley, I don`t understand why you got so upset. I also looked at your spread sheet but didn`t download it as it will always be there to peruse. You put together a marvellous spread sheet and people were impressed. but you did put it on the WORLD WIDE WEB. I also have rubber trees( 20 rai with another 15 to plant this year) but don,t quite agree with your figures. Personally I think they are a little conservative. Which is maybe a good thing as it prevents people from having delusions about getting stinking rich from rubber trees.

don`t stop posting mate, we`re all learning together.

Lang mae yer lum reek.

Awra best,

Chang35baht (Stuart).

Edited January 4, 2008 by chang35baht

[Joe Walshe]

Just downloaded spreadsheet. Will need to study it later. Much to consider. Appreciate it being made available. Joe.

[dsys]

Charlie,

I also looked at your file. I too do not agree with your numbers. The reason I did not reply the first time is that I saw a few holes in the spreadsheet and did not want to criticise. Here are my initial thoughts purely from an appraisal of investment point of view:

1. Your profit figures appear to take no account of the cost of maintaining the land - clearing and fertiliser - and there is no charge for the inital purchase of trees or equipment. I see a large number of investment proposals every week and the ones that just take taxes out and no other costs go straight in the bin.

2. There is no ongoing planting. Generally a good idea to plant trees every year for seven years at least and continue the replacement programme. (related to point 6). Also there is no account taken for thinning out, generally increases the yield.

3. The tappers in this area can take 60% cut, they have more than enough work and unless you are prepared to do the work yourself then there is only a 40% cut in your pocket. May be different in your area.

4. There is no estimation of price fluctuations. Generally rubber follows the oil futures market. However the amount of rubber that has gone in recently is huge. Driving around our area and numerous other provinces all i see is rubber. I would run the figures again at a lower price and see if you are still interested.

5. Same as 4 really but there is no sensitivity analysis and hence you do not have an idea of the risk involved. eg. disease, failures, high winds - (not a pretty sight seeing a couple of thousand 2 year olds with the roots up after a storm - saw that last year)

6. Straight profit calcultaions are worthless without a cash flow estimation. Think about your cash flow before your profit, you might be scared off by how much money is needed before any comes in.

Personally I would look at the above before investing in any project; farming or not. If this was an investment proposal that came accross my desk I would not touch it in its present form.

Sorry if that is a bit harsh but it is what I thought at the time and I was going to keep it to myself - but you asked for input.

We have stopped putting in rubber at the moment and have even ripped 1000 trees out to replace with maize. Too many people here doing it. We have changed our rubber business model to producing rubber matts. Sets us up as a bit of a hated middleman but there is less risk, less investment and less land used up.

[Mosha]

However round here we use Burmese labour and they get 40% of the cut. We intend to use I Thai and 2 Burmese. So 50% sounds generous to the tappers. The Thai (my wife's son in law) reckons they can do 50 a trees a night. Work starts round here at about 1- 2 :00 am. Home for breakfast then convert the crop into mats.

[JungleBiker]

However round here we use Burmese labour and they get 40% of the cut. We intend to use I Thai and 2 Burmese. So 50% sounds generous to the tappers. The Thai (my wife's son in law) reckons they can do 50 a trees a night. Work starts round here at about 1- 2 :00 am. Home for breakfast then convert the crop into mats.

I think you mean 500 not 50 trees per night, right?

[chang35baht]

However round here we use Burmese labour and they get 40% of the cut. We intend to use I Thai and 2 Burmese. So 50% sounds generous to the tappers. The Thai (my wife's son in law) reckons they can do 50 a trees a night. Work starts round here at about 1- 2 :00 am. Home for breakfast then convert the crop into mats.

I think you mean 500 not 50 trees per night, right?

Per person right

[JungleBiker]

Hi Charlie,

Like the others said, don't get upset and please keep posting.

I just downloaded your spreadsheet to see what the fuss was about. I agree with dsys that you need to include all the production costs. For an example see the following link. It's for coffee not rubber, but the same approach could be used.

www2.ctahr.hawaii.edu/oc/freepubs/spreads/coffee$.xls

I used to have a spreadsheet for rubber prepared by one of the world's leading rubber economists, the actual costs/prices would be out of date now but the format would still be valid. Unfortunately I lost it! Sorry about that.

Anyhow, good luck with whatever you decide to do.

JB.

[Mosha]

However round here we use Burmese labour and they get 40% of the cut. We intend to use I Thai and 2 Burmese. So 50% sounds generous to the tappers. The Thai (my wife's son in law) reckons they can do 50 a trees a night. Work starts round here at about 1- 2 :00 am. Home for breakfast then convert the crop into mats.

I think you mean 500 not 50 trees per night, right?

Per person right

Sorry yes 500 per person per night.

[markymark32]

I am going to plant para tree on 30 rai in hua hin? is there any advice what is the best time or season to plant

As I heard some it is good to plant before rainy season, so you dont need to instal sprinklers...

Is anybody know what is the good seed or plant to use...i read that the annual yield for ordinary para tree is 450 kg per hectare and for specially selected high-yields may range as high as 2225 kg per hectare...

Thanks in advance for any suggestions....

Mark

Edited January 6, 2008 by markymark32

[scotbeve]

Joe

Before I started looking at returns from a rubber plantation I would be checking out the costs. 200 rai is a big investment. You will be payimg out for years and not just a few dollars here and there. You will need to buy a tractor, truck and tools before you even start. Fertiliser alone will cost around $10,000 to $15,000b us per year,never mind the cost of trees,labour etc.

If you are interested PM me and you can come over to have a look at my place near Buntrik { corner of Lao Cambodia} a long drive,but it may save you a lot in the long run.

JIM

Jim,

Hasn't the local TAO & KASET (Agricultural Office) been getting involved with organic (re:cheap) fertilizer yet??

[scotbeve]

I did see a Discovery episode about rubber. 2 things stuck out.

1 It only grows well within 15 deg of the equator.

2 The world can't grow enough of the stuff. It's known as Malaysia's white gold.

When and if you do plant it it be prepared for a 7 or 8 year wait. I think current root stock prices are adout 10 Baht each, though I may be wrong.

Last week the sapling price was 18 Baht per. And yes, 7 years is the minimum you should wait for to allow the trees to mature. Thailand is now the leading producer of raw latex. During the last (Taksin) administration, the PM made an alignment with Indonesia and Malaysia to cap the price evenly across the 3 nations. The Sept. 08' futures are quoting 88 Baht for 1 kg. RSS1. Not bad if you consider that the price was 25 Baht 3 1/2 to 4 years ago. China and Vietnam have lost many trees due to adverse (re: cold and extra wet) weather. Expect the price to go up from 2 factors: the crude oil prices and this unfortunate weather that the other countries are experiencing. BEWARE planters of rubber (or other crops) in the north and NE.... The meterology dept expects a very early & hot summer

[jamescollister]

Hello Scot

Yes the Government did come around about 2 years ago trying to set up an organic fertiliser project, but the locals didn't show any interest. Fortunatly or unfortunatly depanding how you look at this the locals are very much against change,I am one who thinks things are changing at too fast a rate. When I came here there was no electricity, no phones and only 2 cars in the village. Now the place is turning into a car park and every second house has a TV. On the bright side the roads are now good and the 4 hour drive to Ubon is onlly 2 1/2 hours. Rubber has started to bring in alot of money to the area so the rate of charge will only get faster. I'm not helping as I am building a rubber processing factory at the moment, which means more cars, tucks etc Jim