Rice-Pledging Scheme: How Much Have We Lost, Yingluck Asks

[notmyself]

I said yesterday that I am no high flown economist, but.......................... having heard about this scheme, I could not understand how a degradable product would be of higher value the year following to being put in storage. Someone please tell me I am a moron and do not understand the simple principles of economics!

Rice can last many years if stored well but with inflation and overheads from storage it would be a bad bet.

But it certainly doesn't improve with age, and fresh crop will always be more sought after than old crop. So instantly there would be a write down in sale value pertaining to crop year.

It does improve with age up to a point. Given the choice between this years harvest and last I will take last years every time. In my view and many others, around 18 months and it will be at its peak but it degrades quite quickly after 2 years even if stored well.

[Thai at Heart]

But it certainly doesn't improve with age, and fresh crop will always be more sought after than old crop. So instantly there would be a write down in sale value pertaining to crop year.

It does improve with age up to a point. Given the choice between this years harvest and last I will take last years every time. In my view and many others, around 18 months and it will be at its peak but it degrades quite quickly after 2 years even if stored well.

Never heard about that before, but I stand corrected. However, does this refer to storage in silos for maturation, because believe me, Thailand and just about nowhere in the world has adequate silo storage for 20mn tonnes.

Right now it is all sitting in hessian sacks in massive piles in some decent and an awful lot of crappy warehouses.

[Baerboxer]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

Do you really expect any honest figures to be made available? Moody's certainly don't hence downgrading now with what figures seem available. This is an important government program and it's inconceivable that the figures aren't readily available and known to the PM and her cabinet. The issue is trying to find ways to massage them, muddy the waters and buy more time.

I'm surprised we haven't seen any comments on this OP from Amore, Rich Teacher, the Derby County fan, and all the other usual PTP supporters. It would be interesting to read their justification of this scheme and apparent lack of transparent figures and financial management within the government. Still, luxury car imports are up so can't all be bad..................... for some.

[waza]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

Instead of coming on TVF and looking like a tit try sending your complaints to the real villains. Not sure who they are? Listen to Yingluck..........

Deputy Bank of Thailand governor Pongpen Ruengvirayudh said the warning by Moody's had affected Thailand's image, and if it downgraded Thailand's credit rating, this would affect domestic and overseas investment, plus mobilisation of capital by both the public and private sectors.............She said Moody's warning needed to be double-checked and balanced by actual figures on profitability of the rice scheme from the Commerce Ministry. "It's a responsibility of Thai authorities to give actual figures to Moody's," she noted.

[animatic]

Their only bloody hope is to quickly set up rice burning energy plants

and convert much of the lost / damaged rice into covering part of the national energy bill.

Of course this takes out-of-the-box, forward thinking and this government has

so little available it is surely a future-grasping-deficit of massive proportions.

Rice contains too much moisture to use it. I've been through this with a couple of helpful members and a few friends. You need to remember that although some 18 million tonnes is quite a large amount [sic] it's dotted around all over the place and will need to be transported to a plant which takes energy, removing the moisture will also take energy and it also takes some energy to exchange the energy from rice. In the end it takes more energy than is given back so you lose.

Yes, indeed it is not a perfect solution, and I wasn't saying it is a single fuel solution.

Sun drying it under some form of cover is a partial solution to excessive moisture.

But the alternative if it can't feed animals from mold and other age related causes is throw it in the bin.

And that is more expensive than adding it with other fuels for an overall mixed use of it creating energy.

Edited June 5, 2013 by animatic

[Thai at Heart]

I can see where this ends.

Yingluck on television crying because the Commerce Ministry kept it so secret, they didn't tell her.

[pisico]

I anticipate that we shall see some interesting accounting.

Governments have a tendency to use funds in interesting ways. For example, in many western countries we see the monies collected for unemployment insurance plans or other benefit programs treated as part of the "revenues" which is then used to reduce a government deficit. It may look nice on paper, but it doesn't really fool the rating agencies.The cautionary lesson the Thai government should take away from that approach is that the numbers can be massaged and cooked, but the people doing the verifications will see through the hocus pocus trickery.

Forgive me, but I think it will play out this way;

- Government provides numbers

- Rating agencies pull them apart

- Government then claims these foreign devils are biased or don't understand the program and then do the usual huff and puff , bruised national pride, rally around the flag routine. Government then provides "explanation".

- Rating agencies question the numbers and then if the numbers are very bad downgrade the Thai sovereign debt rating.

I have a suggestion to the Thai government. Don't bother with the many month of arguing, and just accept the inevitable outcome now. Better yet, just address the rice pledging plan's problems.

Do you really think that anyone in the Thai government will ever read your suggestions? People in government, from the PM to the last MP and/or governor, seldom walk the streets or sidewalks. They are detached from reality and think that the only reality is the one furnished to them by their staff. Furthermore, Thailand is eons away from being multi-lingual like Singapore. Can/will they read this forum? Maybe Mark and a handful of MPs. However, playing Devil's advocate, if they ever read your comments they will say: "Farang can't understand thainess."

[animatic]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

5555 nice try, no sale 55555

[whybother]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

I'm not so surprised that a PTP/Thaksin/Red Shirt supporter has come in to defend this debacle. Even if it is a pathetically lame attempt.

I think it's actually the government that is doing their best to destroy Thailand's credibility. I doubt many currency marketers are trolling through Thai Visa to get their information.

I suppose you are also calling Moodys traitors too, since the figures have not been published, they can't know what they're talking about either.

Edited June 5, 2013 by whybother

[notmyself]

But it certainly doesn't improve with age, and fresh crop will always be more sought after than old crop. So instantly there would be a write down in sale value pertaining to crop year.

It does improve with age up to a point. Given the choice between this years harvest and last I will take last years every time. In my view and many others, around 18 months and it will be at its peak but it degrades quite quickly after 2 years even if stored well.

Never heard about that before, but I stand corrected. However, does this refer to storage in silos for maturation, because believe me, Thailand and just about nowhere in the world has adequate silo storage for 20mn tonnes.

Right now it is all sitting in hessian sacks in massive piles in some decent and an awful lot of crappy warehouses.

Biggest storage facility in in Canada I think at 250,000 ton. I would be happy to say that most of the rice in storage is trashed so I'm on your side and on the side on reason.

[Sydebolle]

Does that mean, that Lotus will sell the rice as of immediate effect priced by the grain then?

[notmyself]

Yes, indeed it is not a perfect solution, and I wasn't saying it is a single fuel solution.

Sun drying it under some form of cover is a partial solution to excessive moisture.

But the alternative if it can't feed animals from mold and other age related causes is throw it in the bin.

And that is more expensive than adding it with other fuels for an overall mixed use of it creating energy.

Animal food is as far as I can see the only option. Once it leaves Thailand it will be prone to dumping regulations so that is not an option.

[rubl]

"Flustered PM orders commerce minister to reveal details"

while we're at it may we ask the PM to also order the Minister of Foreign Affairs to immediately revoke the passport of a criminal fugitive as requested by the Ombudsman a few times already.

[bigbamboo]

can anyone enlighten me,,,if greece got into the eu,,on falsified claims about there economy,surely this government can do the same with the rice figures,are moodys really able to prove otherwise,,sreious question thanks all,,

I thought Greece was allowed into the EU to piss off the Turks!

[BuddyPinkham]

The government yesterday ordered immediate verification of the status of the rice-pledging scheme in a bid to determine its profitability - and counter a warning by Moody's rating agency that the controversial policy could hurt the Thai economy and cause a downgrade of its credit rating.

We all know they will just make up new numbers to make the sheets balance!

Edited June 5, 2013 by metisdead
There is no need to post using bold font. Bold font removed.

[Thai at Heart]

can anyone enlighten me,,,if greece got into the eu,,on falsified claims about there economy,surely this government can do the same with the rice figures,are moodys really able to prove otherwise,,sreious question thanks all,,

I thought Greece was allowed into the EU to piss off the Turks!

And the Albanians, the Bulgarians and a few other Russian satellite states at the time. I don't think Greece EVER met the criterion to get in.

[notmyself]

can anyone enlighten me,,,if greece got into the eu,,on falsified claims about there economy,surely this government can do the same with the rice figures,are moodys really able to prove otherwise,,sreious question thanks all,,

I thought Greece was allowed into the EU to piss off the Turks!

Well, Greece entered the EU for help but it didn't happen. Sad I think

[Payboy]

can anyone enlighten me,,,if greece got into the eu,,on falsified claims about there economy,surely this government can do the same with the rice figures,are moodys really able to prove otherwise,,sreious question thanks all,,

I thought Greece was allowed into the EU to piss off the Turks!

Or to make the Italians and Spaniards look good.

[Redhawk]

When governments engage themselves in business, it is getting worse, they are the worst businesspeople on earth!

[rubl]

"Natthawut, speaking after the Cabinet meeting, said Yingluck had approved his idea to launch a mobile public relations campaign to raise awareness of the rice-pledging scheme with farmers across the country. The first event would be held in Phitsanulok on Sunday (June 9).

Explanations would be given to farmers during the rally, while a compilation of details on the scheme would be collected. The Bt260 billion figure was likely to be inaccurate and calculated from a "misuse of criteria", he said."

I'm puzzled by this. I thought farmers were aware of the 'rice-pledging scheme' and already made use of it. I mean two years of THB 300 billion spend surely went to farmers, now didn't it?

BTW rather than explain to farmers who already know, wouldn't it be better to explain to Moody's or doesn't that matter?

[ratcatcher]

The Commerce Minister has been instructed to reveal the full costs of the scheme, at this point, but why was this ever necessary ? Shouldn't the figures already be in the public domain, under any transparent regime, it simply begs the question, what have they been trying to hide ever since the scheme started ?

And preparing figures to supply to Moody's themselves, why not make those same figures available-to-all on an on-going basis, including the tax-payers whose money has been lost on this foolish adventure ?

It's embarrassing that even the PM herself still doesn't know the facts, from month-to-month at least, no wonder she finds it hard to answer questions and runs away from the reporters' questions. Perhaps her brother should have kept her better-informed, perhaps she should have insisted that he do so, or perhaps its time to sack 'her' ministers who have failed to brief her properly !

The figures ought to detail current-volumes and ages of the government rice-stocks, and mark-to-market prices, not show them at purchase-cost, but will they ? Or will fudge continue to be the order-of-the-day ?

Full details of government-to-government deals must now be released, with the identities of counter-parties revealed, and tonnages contracted/shipped detailed, so that they can be verified by independent sources, also the prices agreed and actually paid (if yet paid), the time for claiming commercial-confidentiality is now way past !

One might also hope for more information on the BAAC, and how much of the government's debt in respect of this scheme, has ever been reimbursed to them, until then the markets and public might well question whether the bank's finances remain sound. This is serious stuff, given other recent bank-failures and the 1997-situation, the government's silence would risk serious loss-of-confidence in the Thai banking-system.

Until then, the market (and ratings-agencies) are fully-entitled to question the true cost of the scheme, and to threaten to down-grade Thai debt, in advance of the massive long-term borrowing demanded by the delayed flood-works and the ambitious infrastructure-improvements planned.

But somehow one doesn't expect the full truth to emerge just yet, despite all the promises, the excuses and blame-laying has a long way to run as yet.

Embarrassing when the PM doesn't know the facts you are assuming she wanted to know the facts

As I've said before. Plausible Deniability.

Or maybe just Criminal Culpability?

[Thai at Heart]

"Natthawut, speaking after the Cabinet meeting, said Yingluck had approved his idea to launch a mobile public relations campaign to raise awareness of the rice-pledging scheme with farmers across the country. The first event would be held in Phitsanulok on Sunday (June 9).

Explanations would be given to farmers during the rally, while a compilation of details on the scheme would be collected. The Bt260 billion figure was likely to be inaccurate and calculated from a "misuse of criteria", he said."

I'm puzzled by this. I thought farmers were aware of the 'rice-pledging scheme' and already made use of it. I mean two years of THB 300 billion spend surely went to farmers, now didn't it?

BTW rather than explain to farmers who already know, wouldn't it be better to explain to Moody's or doesn't that matter?

Indeed. What exactly is he going to explain? Why it can't continue this year? Why they have to grow less this year?

Explain what exactly? Or is he expecting Moody's to pitch up to Nakorn Nowhere to hear his explaination?

"Hello kaaa"

"Yes hello, this is Mr. Moody calling, I would like to speak with Mr. Nattawut concerning the report on the Thai rice subsidy system. Ms. Yingluck's office said that he was the man to speak to."

"Solly kaaaa, Mr. Nattawut, he go up-country, back 3 months. Ok Kaaa. Bye Bye."

[ratcatcher]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

OMG! The lonely voice in the wilderness has arrived at last.

The present maladministration of this country has excelled itself in destroying Thailand's reputation over the last few years and not only with the rice..

Those whom you so foolishly accuse of being traitors are wise enough to realize that in this case this rice pledging scam has been a disaster since day one and is finally being exposed by outside forces like Moody's who live in the real world of facts and fudged figures.

I just hope there's enough room on the perches when the chickens finally come home to roost.

But,hey indy, keep up the support god knows she'll need it.

[smedly]

They cannot do the accounts on the rice scheme because that would reveal 47billion unaccounted for. Anyone that thinks TS hasn't already got his money back is very naive

It's interesting that in a round about way Moody's is saying they do not believe what they are being told and need firm accurate believable official clarification

I feel and election coming very soon - it's becoming evident - that is the only way out of this mess

[Johnnie99]

Is she seriously expecting an honest answer? Really?

[Thai at Heart]

Is she seriously expecting an honest answer? Really?

Well, Moody's is. Or, the poop is really going to hit the fan when there is a downgrade.

Maybe they will declare whatever ground breaking new info to Moody's as confidential......

[PaullyW]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

Ahh, you knew you would get more than a few responses from your comment.

"Traitors"?! I had a chuckle when I read that.

Many of us here are on the side of competence, honesty, truth and those who actually care for people (Thai or other, in Thailand or elsewhere). This isn't high school football -- I don't care about 'Thailand' for the sake of it or because I am here. I care about actions/results. If my government had handled itself in the same way (as it does from time to time), I would have the same disregard for its survivability.

I think sadly for many honest, hard working, if simple Thais, it is easy to not feel too terribly bad for them for the fact that most of them don't understand that their better futures and lives require their active participation. The rich Chinese they imported and allowed to turn this country into a personal club for a handful of families and the similarly detestable rich/powerful other Thais love and care for them and Thailand no more than many of us 1-month tourists or long-term expats/residents. Those people often care for more about themselves and those immediately close to them rather than the country as a whole.

My fear is generally that Thailand will have to fall pretty hard (much harder than anything in recent history) to grow into this understanding. If the general citizenry doesn't take an active role in the country's future, they can only expect to get lucky but so many times that they will magically get leaders who are competent enough to lead and who actually care about the welfares of TH's general citizenry more than their own.

Until then, they deserve what they get, I'm afraid.

Edited June 5, 2013 by PaullyW

[rubl]

^ wrong question.

May I suggest "Is she seriously expecting an answer which will satisfy Moody's?"

[longway]

It seems that most responders to this thread are doing their best to destroy Thailands credibility since they must know that what is written here is devoured by the currency marketers.

Shame on all of those guilty of joining the feeding frenzy of the foreign community that would attempt to keep Thailand's sovereign ratings low. In a sense you are Traitors because none of you know what you are talking about simply because the actual figures have not been published.

OMG! The lonely voice in the wilderness has arrived at last.

The present maladministration of this country has excelled itself in destroying Thailand's reputation over the last few years and not only with the rice..

Those whom you so foolishly accuse of being traitors are wise enough to realize that in this case this rice pledging scam has been a disaster since day one and is finally being exposed by outside forces like Moody's who live in the real world of facts and fudged figures.

I just hope there's enough room on the perches when the chickens finally come home to roost.

But,hey indy, keep up the support god knows she'll need it.

I bet you could actually hear the sound of indyuk's brain forming itself into a pretzel shape as he looked for a way to defend the PTP on this one. Very funny to see.

For the sake of his own sanity he should just step away from the Internet for a while.

Edited June 5, 2013 by longway

[finnomick]

Err, surely this is something you should already know PM ?