Pledging policy blamed for drastic fall in price of Thai rice

[Skywalker69]

The already-rich Chinese-Thai rice millers aren't complaining. They were probably front of the queue when gov't money was being handed out.

Let's think outside-the-box for a moment. There's a crop which is superior to rice for the following reasons... can you guess which crop?

>>> grows like a weed in poor soils

>>> doesn't need copious amounts of water, like rice does

>>> doesn't need pesticides or herbicides like rice does

>>> doesn't destroy watersheds like rice paddies do

>>> has higher $ value than rice

>>> its seed and oil are much more nutritious. What is rice, other than starch?

>>> has hundreds of practical applications. Just one: Volvo uses one part of the plant to cushion its car and truck seats.

answer: HEMP

The already-rich Chinese-Thai rice millers aren't complaining. They were probably front of the queue when gov't money was being handed out.

Agreed, look at Arisman he has a Airline Company today.

[CWMcMurray]

We bought two 5 kg bags yesterday and my wife was saying how expensive it is getting. I guess the price isn't falling in the supermarkets.

I reckon the price of rice in supermarkets is up about 100% over the past few years.

And it seems that has been the solution... Can't raise prices for export, but nothing to stop doubling the domestic price

So sell the old expensive low quality rice in the domestic market ... And initiate more controls on foreign rice imports .. There by forcing the Thai's to pay twice

Once in taxes wasted and again at the supermarket with inflated prices

It seems the above is the only thin that ales sense... As around the world prices of Thai rice are down while magnitude same time doubled in Thailand?

Sent from my iPhone using Tapatalk

Edited May 26, 2014 by CWMcMurray

[rametindallas]

Torch the stockpile that you can never sell and just start again. It's the only way the farmers will get their livelihoods back.

And send the bill to Taksin!

The government borrowed well over 19.68 billion US dollars to buy that stockpile and you want to burn it? It's like the taxpayer gets raped twice to satisfy rice farmers. For the billions of dollars involved, they could build a gasohol plant and, not only recoup the cost of building a gasohol plant, but get some of the money back by selling rice-made alcohol to pay off that massive loan. This should also reduce the amount of imported fuel. The overproduction capacity of rice needs to be wrung out of the system; it's not sustainable. Some of the 'Johnny come lately' farmers and those who planted on land not suitable for rice need to lose out. Too bad if the farmers who benefited from the windfall of 40% higher prices didn't put some into savings. It can't be the taxpayer who make up for the poor decisions of some rice farmers. Since Thailand has the worst efficiency in SE Asia for growing rice, maybe rice should be grown only in good rice-growing areas in quantities that are sustainable. Maybe some low-interest loans for long time farmers to transition to other crops could be arranged. Once the Rice Support Scheme is fully audited, some money may be retrieved from corrupt rice mills, rice middlemen, government officials. etc.. In any case there will be a lot of people, taxpayers and farmers, who will suffer in the coming decade. Thanks, Thaksin and Yingluck, you really helped the farmers and Thailand.

[Roadman]

I know this is not likely to go down too well on this thread but there are some strong points made that I equally strongly disagree with.

Subsidies are not always bad. When they are made for the right reasons and directed mainly at the right targets - they are for the common good. The EU agricultural subsidies were (& still are to some degree) a good example. They effectively transferred some of the wealth from the richer regions to the poorer ones. It wasn't by any means perfect but broadly did the job.

The second reason for them was the flight from the land. The EU correctly saw that in places like rural Ireland, Greece & Portugal, farmers were deserting the land in droves and moving to the cities to find jobs. Not good if it gets out of hand and your region can't produce enough food for local consumption. Importing basic foodstuffs is not a very economical nor is it a good strategy in times of conflict.

Having said that, the Thai rice subsidy - Thaksin version - was carried out for all the wrong reasons. One, it was a vote-buying ploy. Two, it was very badly structured towards the millers, storage companies and big land owners. Three, it did not make any attempt to help those really in need. Four, it set the prices too high. Five, it was poorly run. Six, it had corruption written all over it but the party refused & blocked & obfuscated & lied - so much that financial figures and amounts of rice in stock are still a grey area.

In a nutshell, subsidies can work if finely directed at identified needful targets.

Exactly. For westerners to bemoan agribusiness subsidies as some kind of devil born socialism while our own countries spend billions is hypocritical in the extreme.

Agrisubsidy is a fact of life. Farmers only have one life, if someone else gets a subsidy, why can't I? To make taxpayers sleep better?

BS.

Yes we can bemoan.... New Zealand does not pay any subsidies to farmers full stop. All farmers were abruptly taken off them in our economic shake up three decades ago. That is why we fight tooth and nail (bemoan) at the point where it matters in trade agreements where we have to compete with our subsidy free product against the local market subsidied produce. The only government assistance here for farmers is via emergency assistance when floods and droughts for example hit and even then it is by relief assistance not handouts. But on the hand there has been heaps poured into research and development to assist in better options and improvements.

The telling comments where Thailand is concerned are the ones where the farmers are still doing what their forefathers are doing. That is where the biggest shake up is needed.

[boomerangutang]

re; HEMP....

Its not a staple diet product

It is probably also illegal to grow here.

It is illegal to grow hemp in Thailand. Thailand copies US drug laws word for word. Even if the US is adjusting toward common sense, Thailand will continue to be 30 years behind the 8 ball. China, Canada, and 40 other countries allow farmers to grow hemp, and they're all gaining benefits from that.

As for the word 'staple': Perhaps hemp seed could not be defined as a 'staple crop' - though its seeds contain a great balance of nutrition, including Omega 3. A Canadian company legally sells breakfast packages made from hemp seed. Hemp oil has many qualities.

Things change. People adjust. Not long ago, coffee was almost unknown in Thailand, except at high class hotels. A few food items which have been added to Thai cuisine in the past couple hundred years: hot peppers, potatoes, tomatoes, corn.

A crop doesn't have to be labelled 'a staple' to be gainfully grown by farmers. Perhaps 5% of all crops grown could be labelled as such.

[rebelplatoon]

As Yogi Berra said: it s deja vu all over again!

Never works this interferring with free market mechanisms.

Hate saying: i told you so.

[englishoak]

re; HEMP....

Its not a staple diet product

It is probably also illegal to grow here.

It is illegal to grow hemp in Thailand. Thailand copies US drug laws word for word. Even if the US is adjusting toward common sense, Thailand will continue to be 30 years behind the 8 ball. China, Canada, and 40 other countries allow farmers to grow hemp, and they're all gaining benefits from that.

As for the word 'staple': Perhaps hemp seed could not be defined as a 'staple crop' - though its seeds contain a great balance of nutrition, including Omega 3. A Canadian company legally sells breakfast packages made from hemp seed. Hemp oil has many qualities.

Things change. People adjust. Not long ago, coffee was almost unknown in Thailand, except at high class hotels. A few food items which have been added to Thai cuisine in the past couple hundred years: hot peppers, potatoes, tomatoes, corn.

A crop doesn't have to be labelled 'a staple' to be gainfully grown by farmers. Perhaps 5% of all crops grown could be labelled as such.

Oh im all for Hemp, things go in cycles and very little hemp is of the getting high kind. It is incredibly versatile and Britain could arguably owe its domination of the seas for a century or so due to hemp rope rigging.

Clothing, loose soil binding, oil, industry products the uses are widespread,It makes great fish feed too.

Im not so sure Thailand follows the US drug laws word for word at all btw, the penalties here are not much different re possession over supply and there are no states or regions its legal here

I agree 5% would be fine.

[kimamey]

The big question that I would have is - how do they shift the massive stock pile of old rice before the end of the next growing period - why should a customer be buy from old stock - simple, it has to be cheaper

Not that I know very much about rice farming but it seems to me that the government should be addressing the high material cost to actually grow the rice and leave the market alone - investigate the costs involved in fertilizers etc and investigate those that are price fixing and introducing price controls and possible subsidies at the front end reducing the cost to actually grow it

A rice subsidy isn't so bad and both parties have had them but they have to be reasonable. The problem here is that a lot of the extra paid was taken up by increased costs and land rents. Your idea might have some merit. I know one woman who owns some rice fields but doesn't grow the rice herself. She as the landowner gets the money and shares the extra with the grower. She's a PTP supporter by the way so they're not all bad.

She thinks the scheme is good because she gets more than she used to so her support is understand able. It may be why the PTP won by so much in 2011. If you're offered a lot of money when you don't have much it's not surprising if you don't spend much time wondering how it will be paid.

You don't know much about rice farming!!! You're useless. Only fit to be chairman of the rice committee. I'll put your name forward. Don't worry you won't have to go to a lot of meetings.

Sent from my Nexus 4 using Thaivisa Connect Thailand mobile app

can you explain the above in bold - I thought you were having a reasonable conversation until I read that - you really lost me on that one

Please explain before I have your post removed - there is no place here for insults

Sorry about that, it wasn't meant as an insult just a reference to the fact that the chairwoman of the rice committee didn't know much about rice farming either and didn't go to many meetings.

[EyesWideOpen]

Opinions aside, at this point everyone pretty well recognizes that the rice scam was

truly an epic fail on all levels. I look forward to the military government telling us where

the hundreds of billions of baht went to, because it sure as hell did not go to the farmers...

[Thai at Heart]

I know this is not likely to go down too well on this thread but there are some strong points made that I equally strongly disagree with.

Subsidies are not always bad. When they are made for the right reasons and directed mainly at the right targets - they are for the common good. The EU agricultural subsidies were (& still are to some degree) a good example. They effectively transferred some of the wealth from the richer regions to the poorer ones. It wasn't by any means perfect but broadly did the job.

The second reason for them was the flight from the land. The EU correctly saw that in places like rural Ireland, Greece & Portugal, farmers were deserting the land in droves and moving to the cities to find jobs. Not good if it gets out of hand and your region can't produce enough food for local consumption. Importing basic foodstuffs is not a very economical nor is it a good strategy in times of conflict.

Having said that, the Thai rice subsidy - Thaksin version - was carried out for all the wrong reasons. One, it was a vote-buying ploy. Two, it was very badly structured towards the millers, storage companies and big land owners. Three, it did not make any attempt to help those really in need. Four, it set the prices too high. Five, it was poorly run. Six, it had corruption written all over it but the party refused & blocked & obfuscated & lied - so much that financial figures and amounts of rice in stock are still a grey area.

In a nutshell, subsidies can work if finely directed at identified needful targets.

Exactly. For westerners to bemoan agribusiness subsidies as some kind of devil born socialism while our own countries spend billions is hypocritical in the extreme.

Agrisubsidy is a fact of life. Farmers only have one life, if someone else gets a subsidy, why can't I? To make taxpayers sleep better?

BS.

Yes we can bemoan.... New Zealand does not pay any subsidies to farmers full stop. All farmers were abruptly taken off them in our economic shake up three decades ago. That is why we fight tooth and nail (bemoan) at the point where it matters in trade agreements where we have to compete with our subsidy free product against the local market subsidied produce. The only government assistance here for farmers is via emergency assistance when floods and droughts for example hit and even then it is by relief assistance not handouts. But on the hand there has been heaps poured into research and development to assist in better options and improvements.

The telling comments where Thailand is concerned are the ones where the farmers are still doing what their forefathers are doing. That is where the biggest shake up is needed.

New Zealand is fairly unique to this end, and has devoted billions to r&d to get this achieved.

The Thai rice industry is a snake pit of politics and corruption. It cannot be reformed over night. But that doesn't help the average rice farmer. I would allow foreign buyers to go.direct to the farmer and contract directly. Cut the middle men out of it.

[edwinchester]

I know this is not likely to go down too well on this thread but there are some strong points made that I equally strongly disagree with.

Subsidies are not always bad. When they are made for the right reasons and directed mainly at the right targets - they are for the common good. The EU agricultural subsidies were (& still are to some degree) a good example. They effectively transferred some of the wealth from the richer regions to the poorer ones. It wasn't by any means perfect but broadly did the job.

The second reason for them was the flight from the land. The EU correctly saw that in places like rural Ireland, Greece & Portugal, farmers were deserting the land in droves and moving to the cities to find jobs. Not good if it gets out of hand and your region can't produce enough food for local consumption. Importing basic foodstuffs is not a very economical nor is it a good strategy in times of conflict.

Having said that, the Thai rice subsidy - Thaksin version - was carried out for all the wrong reasons. One, it was a vote-buying ploy. Two, it was very badly structured towards the millers, storage companies and big land owners. Three, it did not make any attempt to help those really in need. Four, it set the prices too high. Five, it was poorly run. Six, it had corruption written all over it but the party refused & blocked & obfuscated & lied - so much that financial figures and amounts of rice in stock are still a grey area.

In a nutshell, subsidies can work if finely directed at identified needful targets.

Exactly. For westerners to bemoan agribusiness subsidies as some kind of devil born socialism while our own countries spend billions is hypocritical in the extreme.

Agrisubsidy is a fact of life. Farmers only have one life, if someone else gets a subsidy, why can't I? To make taxpayers sleep better?

BS.

Yes we can bemoan.... New Zealand does not pay any subsidies to farmers full stop. All farmers were abruptly taken off them in our economic shake up three decades ago. That is why we fight tooth and nail (bemoan) at the point where it matters in trade agreements where we have to compete with our subsidy free product against the local market subsidied produce. The only government assistance here for farmers is via emergency assistance when floods and droughts for example hit and even then it is by relief assistance not handouts. But on the hand there has been heaps poured into research and development to assist in better options and improvements.

The telling comments where Thailand is concerned are the ones where the farmers are still doing what their forefathers are doing. That is where the biggest shake up is needed.

New Zealand is fairly unique to this end, and has devoted billions to r&d to get this achieved.

The Thai rice industry is a snake pit of politics and corruption. It cannot be reformed over night. But that doesn't help the average rice farmer. I would allow foreign buyers to go.direct to the farmer and contract directly. Cut the middle men out of it.

Unlikely that an international buyer would be interested in the 10 tonnes or less that the average Thai farmer crops.

First step would be a return to a subsidy paid directly to the farmer but what there really needs is a massive overhaul of Thai rice production because too much low quality rice is grown in an uneconomic way.

Edited May 28, 2014 by edwinchester

[Thai at Heart]

I know this is not likely to go down too well on this thread but there are some strong points made that I equally strongly disagree with.

Subsidies are not always bad. When they are made for the right reasons and directed mainly at the right targets - they are for the common good. The EU agricultural subsidies were (& still are to some degree) a good example. They effectively transferred some of the wealth from the richer regions to the poorer ones. It wasn't by any means perfect but broadly did the job.

The second reason for them was the flight from the land. The EU correctly saw that in places like rural Ireland, Greece & Portugal, farmers were deserting the land in droves and moving to the cities to find jobs. Not good if it gets out of hand and your region can't produce enough food for local consumption. Importing basic foodstuffs is not a very economical nor is it a good strategy in times of conflict.

Having said that, the Thai rice subsidy - Thaksin version - was carried out for all the wrong reasons. One, it was a vote-buying ploy. Two, it was very badly structured towards the millers, storage companies and big land owners. Three, it did not make any attempt to help those really in need. Four, it set the prices too high. Five, it was poorly run. Six, it had corruption written all over it but the party refused & blocked & obfuscated & lied - so much that financial figures and amounts of rice in stock are still a grey area.

In a nutshell, subsidies can work if finely directed at identified needful targets.

Exactly. For westerners to bemoan agribusiness subsidies as some kind of devil born socialism while our own countries spend billions is hypocritical in the extreme.

Agrisubsidy is a fact of life. Farmers only have one life, if someone else gets a subsidy, why can't I? To make taxpayers sleep better?

BS.

Yes we can bemoan.... New Zealand does not pay any subsidies to farmers full stop. All farmers were abruptly taken off them in our economic shake up three decades ago. That is why we fight tooth and nail (bemoan) at the point where it matters in trade agreements where we have to compete with our subsidy free product against the local market subsidied produce. The only government assistance here for farmers is via emergency assistance when floods and droughts for example hit and even then it is by relief assistance not handouts. But on the hand there has been heaps poured into research and development to assist in better options and improvements.

The telling comments where Thailand is concerned are the ones where the farmers are still doing what their forefathers are doing. That is where the biggest shake up is needed.

New Zealand is fairly unique to this end, and has devoted billions to r&d to get this achieved.

The Thai rice industry is a snake pit of politics and corruption. It cannot be reformed over night. But that doesn't help the average rice farmer. I would allow foreign buyers to go.direct to the farmer and contract directly. Cut the middle men out of it.

Unlikely that an international buyer would be interested in the 10 tonnes or less that the average Thai farmer crops.

First step would be a return to a subsidy paid directly to the farmer but what there really needs is a massive overhaul of Thai rice production because too much low quality rice is grown in an uneconomic way.

Just allow the market to open. First they must licence farmers to grow and stop by his ridiculous free for all growing hither and thither.

Then let the market pursue the best product by opening up the buying to foreigners directly.if the Thai chase 10mt,why can't a foreigner? Then watch the prices go all wonky for a while, and then settle down.

It is the only way to put the middle mans money in the hands of the farmers.

[hawker9000]

Unlikely that an international buyer would be interested in the 10 tonnes or less that the average Thai farmer crops.

First step would be a return to a subsidy paid directly to the farmer but what there really needs is a massive overhaul of Thai rice production because too much low quality rice is grown in an uneconomic way.

Nope. "Duly Elected" thai governments simply cannot be trusted to carry out such projects & policies. The temptation to skim obviously can't be resisted, and of course it quickly evolves into pandering & thinly disguised vote-buying. If international buyers aren't attracted by small - even if direct - rice buys, then the farmers should set up co-ops (withOUT government involvement).

Edited May 29, 2014 by hawker9000

[The Deerhunter]

Come now be honest

Farmer were happy to take the crazy price....why not...I would if offered.

But it was not sustainable. Who did not know that? Look at the result.

Yet the farmers got use to the higher price & thought it would last forever.

rice 10yr.jpg

Are you speaking from personal experience or just from what you read on the news on this forum?

For the first year of the scheme the farmers MAY have got a slight increase in the sale price for their rice but most of the promised 30% increase on market price was sucked up by the millers and at very best the farmers MAY have got 11k or 12k per tonne when the PTP PROMISED them 15k per tonne. The 2nd year Yingluck stopped subsidising the farmers for their irrigation which used to be 2k baht per rai and then the price of rice tumbled, so now you have to deduct another 2k baht from the price of rice which wasn't a factor before. This year the farmers are getting about 6k per tonne at the end. If you really think that the farmers had any time to "get used to the higher price" then I think you are mistaken about what you are talking about.

Last year was the first time ever that my partner's family ever made a loss on their rice. It actually cost them 5k baht last year for them all to work in the fields all year to make rice. Yes they have rice to eat but they could've just bought the rice they needed for probably 5k baht too and saved all the hard graft. They are expecting this year to cost them the same.

Unless something drastic happens then this will continue.

The something drastic has to be ethanol & pigfood/poultryfood/fishfood. Ferment it. Create alcohol for transport, electricity or industry and convert the mash to stockfood. That tired old rice cannot be fit for humans now, it is distorting the price and holding buyers away from thai rice in case they end up with some of it. But, does Thailand have the plant & equipment to convert large store of rice into these other products? It is toast anyway so even shipping it overseas for processing could be worthwhile. It has to be got out of the system and the farmers have all got to be paid so they can start again.

Edited May 29, 2014 by The Deerhunter

[edwinchester]

Unlikely that an international buyer would be interested in the 10 tonnes or less that the average Thai farmer crops.

First step would be a return to a subsidy paid directly to the farmer but what there really needs is a massive overhaul of Thai rice production because too much low quality rice is grown in an uneconomic way.

Nope. "Duly Elected" thai governments simply cannot be trusted to carry out such projects & policies. The temptation to skim obviously can't be resisted, and of course it quickly evolves into pandering & thinly disguised vote-buying. If international buyers aren't attracted by small - even if direct - rice buys, then the farmers should set up co-ops (withOUT government involvement).

Farmers own cooperatives is actually one of the things I had in mind when saying a massive overhaul is required.

It has been tried in the past but was unsuccessful as some of the leaders were murdered.

[ableguy]

According to the OP:

Global rice supply and consumption are projected to reach record levels of 592 tonnes and 482.2 million tonnes.

If they mean 592 MILLION tonnes, then the supply will exceed the demand by 110 million tonnes.... which means that prices will plummet over the next year.

So, how did we get into this situation?

Well, where is Thaksin living? Dubai is one of the members of OPEC, which was one of the most successful cartels in history. In the 1970s, the OPEC countries agreed to limit oil production. I don't have the exact figures, but let's say that they restricted oil production by 20% which caused prices to double. You don't need a PhD from Sam Houston U to do the math! As a result of OPEC's activities, GDP in the Oil producing states skyrocketed.

Thaksin obviously tried to imitate OPEC's success using Thailand's rice production. After all, the Rice Scheme was not a subsidy, it is a government monopoly. However, it just didn't work. Either the other rice producing countries didn't play along or Thaksin overestimated the influence of Thailand on the world rice markets. Either way, we now are faced with the consequences of a failed monopoly.

This is when Thaksin's true business genius shines forth. He gambled with the taxpayers money... if he lost, he wouldn't be out of pocket himself, but if he won, he would be in a position where he could make his constituents happy with the inflated market price while siphoning off billions for himself and his cronies.

His genius dose shine, a perfect plan for stealing for him and his cronies, nobody truly thinks he did for the farmers do they ?? Apart from the farmers that is, sadly they come out of it smelling a bit.

[BlackCedar]

I doubt if the PTP supporters here on TV will have anything useful to contribute to this thread..... ?

Red Shirt sympathisers NEVER ever had anything useful to conrtibute to TV.... Ask the Stuttering Bugie and his crew...

now their lips are sealed...

[BlackCedar]

I doubt if the PTP supporters here on TV will have anything useful to contribute to this thread..... ?

Red Shirt sympathisers NEVER ever had anything useful to conrtibute to TV.... Ask the Stuttering Bugie and his crew...

now their lips are sealed...

[BlackCedar]

Come now be honest

Farmer were happy to take the crazy price....why not...I would if offered.

But it was not sustainable. Who did not know that? Look at the result.

Yet the farmers got use to the higher price & thought it would last forever.

rice 10yr.jpg

Are you speaking from personal experience or just from what you read on the news on this forum?

For the first year of the scheme the farmers MAY have got a slight increase in the sale price for their rice but most of the promised 30% increase on market price was sucked up by the millers and at very best the farmers MAY have got 11k or 12k per tonne when the PTP PROMISED them 15k per tonne. The 2nd year Yingluck stopped subsidising the farmers for their irrigation which used to be 2k baht per rai and then the price of rice tumbled, so now you have to deduct another 2k baht from the price of rice which wasn't a factor before. This year the farmers are getting about 6k per tonne at the end. If you really think that the farmers had any time to "get used to the higher price" then I think you are mistaken about what you are talking about.

Last year was the first time ever that my partner's family ever made a loss on their rice. It actually cost them 5k baht last year for them all to work in the fields all year to make rice. Yes they have rice to eat but they could've just bought the rice they needed for probably 5k baht too and saved all the hard graft. They are expecting this year to cost them the same.

Unless something drastic happens then this will continue.

Seems you picked the wrong partner.... Maybe she will be back at her old Job soon... or will you , The Farang ATM.... will you support them.. ?

[Thai at Heart]

Unlikely that an international buyer would be interested in the 10 tonnes or less that the average Thai farmer crops.

First step would be a return to a subsidy paid directly to the farmer but what there really needs is a massive overhaul of Thai rice production because too much low quality rice is grown in an uneconomic way.

Nope. "Duly Elected" thai governments simply cannot be trusted to carry out such projects & policies. The temptation to skim obviously can't be resisted, and of course it quickly evolves into pandering & thinly disguised vote-buying. If international buyers aren't attracted by small - even if direct - rice buys, then the farmers should set up co-ops (withOUT government involvement).

Farmers own cooperatives is actually one of the things I had in mind when saying a massive overhaul is required.

It has been tried in the past but was unsuccessful as some of the leaders were murdered.

Absolutely. Many so called left wing farming activists were bumped off in the 80s. Say the word commune in the agriculture ministry and the people start hissing.

[Jay Sata]

Thai rice farming is akin to the UK before the agricultural revolution in the late 1700's to mid 1800's.

It needs large farms and high mechanisation to be efficient.

Peasant farmers with a few rai will never escape poverty.