Clarity Needed On Govt Policy To Promote Cassava Plantations: Thai Opinion

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EDITORIAL

Clarity needed on govt policy to promote cassava plantations

The Nation

Populist policies have raised questions over their viability while imports pose a new challenge

The government needs to clarify its policy direction on whether or how to promote cassava plantation. Otherwise, cassava planters will be vulnerable to the changing government policies, which have adversely affected their produce already.

For instance, while the Yingluck government said it would go ahead with its populist policies to benefit the farmers, cassava planters have felt a negative side to these policies. Local planters have been directly affected by the reduction in diesel prices because cassava produce is used in ethanol production, an essential ingredient for the production of gasohol.

In addition, an influx of imported agricultural produce has also hurt local cassava planters during the recent flooding.

This has already added to the challenges cassava planters face from imported cassava produce - direct competition from palm-oil producers in neighbouring countries such as Malaysia and Indonesia.

Over the past four months, local planters have suffered from changing domestic policy. The Yingluck government cut the oil subsidy - resulting in an instant reduction in the diesel price by Bt3 per litre to Bt26.99 - while the price of benzene 91 was cut by Bt7 per litre.

The lower prices of diesel and benzene made gasohol less attractive because of the lower price margin. Drivers shifted back to diesel and benzene until the Yingluck government later announced it was cutting the gasohol price. The price of benzene 91 is now lower than the gasohol 91 price by about Bt3 per litre, compared to about Bt7 prior to the price reduction.

Cassava planters bore the brunt of drastic changes in the government's policy. From the middle of 2010 to early last year, the cassava prices rose sharply because the previous government set a policy to promote the use of gasohol by keeping gasohol prices lower than traditional fuel. Many farmers converted their farms to cassava plantations in the hope of earning more from this economic crop.

The price of cassava, however, saw a declining trend from the middle of last year - partly because gasohol was not competitive in terms of price, compared to traditional fuel.

Unless the situation improves, local planters could soon be trapped in a worse situation. A large amount of cassava produce will be harvested later this month. The government must find a way to open up a market for the cassava products about to hit the market.

The influx of imported palm oil after the flood crisis has also hurt cassava planters. As a result, the future of the planters doesn't look promising, especially after the full implementation of the Asean Economic Community in which Thailand must end tariffs on many agricultural products. This could further open the floodgates to imported produce, which could prove cheaper than local items.

The government should set a clear policy on planting cassava, whether it will continue to promote biodiesel, and how it would help ease the impact on local farmers of the liberalisation of agricultural imports.

What matters more for the planters is not cash handouts but predictable policies that will help their plantation planning. Otherwise, local planters will fall victim to the government's populism, even though the government claims such populism is executed for the sake of grassroots communities.

-- The Nation 2012-01-09

[Moruya]

There are a number of interesting points to be taken from this article:

The word "Cassava" was used 16 times. Quite possibly a world record.

Interestingly not a single person directly involved in the cassava farming industry was referenced.

There was no mention of the Cassava Mob descending to Bangkok to hurl tonnes of roots into the PM's garden.

Revolting groups now seem to include truck, bus and taxi drivers (upset at having to pay the market price for fuel), rubber farmers (upset at the market price dropping), people affected by the floods. Who have I omitted?