Board of Trade of Thailand offers rice strategies

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RICE STRATEGY
BoT offers rice strategies
Petchanet Pratruangkrai
The Nation


Isara Vongkusolkit

BANGKOK: -- The Board of Trade of Thailand will propose five strategies on sustainable rice-industry development to the National Council for Peace and Order (NCPO), a programme it claims would cost the government just Bt20 billion a year, a tenth of the cost of the defunct pledging scheme, to reform farming and marketing.

Isara Vongkusolkit, chairman of the Board of Trade and the Thai Chamber of Commerce, said the rice industry needed long-term development, as it is a key sector of the national economy involving more than 4 million households.

"If the rice industry is successfully developed, it will help reduce income gaps and create sustainable development for rice farmers," he said.

The five strategies will be discussed today at a public-private joint standing committee meeting led by NCPO chief General Prayuth Chan-Ocha.

The strategies are: promoting the "sufficiency economy" philosophy; adopting modern farming technology to increase productivity and reduce costs; promoting alternative economic crops where rice cultivation is not suitable; supporting research and development on rice-seed quality; and supporting market liberalisation by allowing private enterprises to trade rice with no intervention by the government. The government's only role should be to ensure fair benefits for farmers, millers, and rice traders.

As the first step, the chamber suggested that the government reform plantation areas, as some are not suitable for rice cultivation and should be used for other economic crops.

Thailand currently has 70 million rai (11.2 million hectares) of rice-plantation areas, but the chamber has found that 27 million rai is not suited for rice as the land is outside irrigation areas and has inappropriate soil quality. This land should be promoted for other economic crops such as maize, cassava, sugar cane, palm and rubber.

According to a study by the chamber, net incomes for Thai farmers differ widely. Those cultivating oil palm net Bt5,768 per rai on average, sugar cane Bt5,708 per rai, rubber Bt5,128, maize Bt1,196, cassava Bt1,045, and rice a mere Bt271 per rai (Bt1,694 per hectare).

Rice farmers should be encouraged to integrate their plantations to reduce costs.

Moreover, rice marketing should be developed, particularly on the Agriculture Futures Exchange of Thailand, which should reflect real agricultural prices. The government should encourage more traders to participate in the futures market. The chamber suggests that the AFET should be under the control of the Finance Ministry instead of the Commerce Ministry.

Pramoth Vanichanont, an adviser to the chamber's rice strategy working committee and to the Thai Rice Farmers Association, said that if the military government agreed with the proposed five strategies, it would need to spend only Bt20 billion a year to develop the rice industry.

He said past governments needed to spend only about Bt20 billion to Bt30 billion a year to subsidise the rice price since 1992, but that increased to Bt53 billion in 2010-11 under the price-guarantee project. Annual spending surged to Bt200 billion during the 2012-2014 pledging scheme, which was very costly but an inefficient way to support farmers in long-term.

Vichai Assarasakorn, vice chairman of the chamber, said the government should set up a fund to help rice farmers for the long term. The fund could be used for research and development or rice-seed quality, and for aid to farmers hit by natural disasters.

The fund could be sourced from income taxes that rice exporters and millers pay to the Finance Ministry, as well as about Bt2 billion a year exporters pay the Commerce Ministry under the terms of a European Union quota.

Source: http://www.nationmultimedia.com/business/BoT-offers-rice-strategies-30238579.html


-- The Nation 2014-07-16

[Robby nz]

What it really needs is for the farmers to be telling people what they need not the suits in their air con offices.

But of course the farmers are only dumb peasants, what would they know, they haven't been to university like us, we have degrees in all sorts of things.....except farming.

Farmers know their business, their industry they know how to get the best out of the land, the trouble starts when politicians and businessmen interfere with their "We know whats best for you" and being in for their share.

A wonderful example of this are the ongoing rice schemes from Thaksins time to the now ended pledging scheme which has done more to stuff up the rice industry and the farmers than they could have ever done themselves.

Incidentally, a couple of interesting lines at the bottom of an article on rice in the BKK post this morning.

It would seem that locking up the warehouses for the inspections and therefor stopping the panic sales of Thai rice have raised the price of 5% broken Thai rice by $30 per ton.

The price of the same Vietnamese rice has gone up $20 while Indian rice stays the same, both being higher than Thai rice.......a confidence in quality thing ?

[rametindallas]

What it really needs is for the farmers to be telling people what they need not the suits in their air con offices.

But of course the farmers are only dumb peasants, what would they know, they haven't been to university like us, we have degrees in all sorts of things.....except farming.

Farmers know their business, their industry they know how to get the best out of the land, the trouble starts when politicians and businessmen interfere with their "We know whats best for you" and being in for their share.

A wonderful example of this are the ongoing rice schemes from Thaksins time to the now ended pledging scheme which has done more to stuff up the rice industry and the farmers than they could have ever done themselves.

Incidentally, a couple of interesting lines at the bottom of an article on rice in the BKK post this morning.

It would seem that locking up the warehouses for the inspections and therefor stopping the panic sales of Thai rice have raised the price of 5% broken Thai rice by $30 per ton.

The price of the same Vietnamese rice has gone up $20 while Indian rice stays the same, both being higher than Thai rice.......a confidence in quality thing ?

First, if farmers knew their business, they wouldn't need massive government subsidies. If farmers knew their business, there wouldn't be 33% of the rice crops grown on unsuitable land/soil. If the farmers knew their business, they would know that mono-culture depletes the soil, requiring more and more fertilizer, and that they should build their soil by rotating crops.

Even though rice farming is seasonal and there is a lot of downtime, during which time the farmers could educate themselves to new methods and gain efficiencies, the farmers have chosen to sit on their backsides and be more dependent on government help than good weather. Government have promoted that dependency but that is no excuse. Generally speaking, Thai rice farmers are not (well) educated, either in book-learning, improving methods of farming, farming cooperatively, marketing cooperatively, buying their fertilizer and equipment, etc. cooperatively. The proof is in the pudding, i.e. Thai rice farmers are the least productive, per rai, of any rice farmers in SEA. Why is that, when there is great soil, weather, irrigation system, etc., available to them? The soil here is so rich that I have seen fence posts sprout branches. If they don't sprout, then don't plant rice there.

The reason the railroad companies in the US don't own the airlines is because they didn't understand they were in the transportation business and not just the train business. Some oil companies are, belatedly, getting into renewable energy because they are realizing they are not in the oil business but in the energy business. Farmers need to wake up, as it is an ever fast changing world, and realize they are farmers first and rice farmers second so they can stay competitive. Government cannot continue to prop up 'buggy whip' manufacturers at taxpayers' expense.

I agree that politicians are no good at anything but politics, but there are academics, people with serious brain power, who have applied modern thinking to modern processes and who could help the farmers to be more competitive in what they do. No need to reinvent the wheel. This has all been researched and the knowledge is available for free. HM, the King, has developed experimental farms and demonstration projects that, if adopted, could help many farmer improve or transition. Some of the farmers, realistically, need to change away from rice and learn to farm other crops. Rice farming is not so specialized that most of the equipment/land cannot be converted to farm other crops. I grew up on a farm and worked on farms until I was in my mid-twenties so I am not unfamiliar/unsympathetic with the farmers in Thailand; rice or otherwise.

[belg]

no subsidy, if the crop is not worth the costs, why continu this crazy scheme ?

nothing else to farm ? enough people needed in the factories

but there is the problem, they will have to show up and work a bit, in stead of watching the rice grow and drink, gamble away the little income they have

thank god the farmers have daughters they can send to pattaya & other place and she can send money back each month

[Thaddeus]

The Archers was first broadcast on Monday, 2 April 1951.

[Thai at Heart]

no subsidy, if the crop is not worth the costs, why continu this crazy scheme ?

nothing else to farm ? enough people needed in the factories

but there is the problem, they will have to show up and work a bit, in stead of watching the rice grow and drink, gamble away the little income they have

thank god the farmers have daughters they can send to pattaya & other place and she can send money back each month

The craziest part is subsidising it with such huge money just to export it.

That really is nuts. In that context all it is doing is increasing supply and keeping the price down. It really would be better for the country to pay people not to grow it and to give them free rice.

[noitom]

He's offering - in Thailand, he is offering. Thais are always "offering" but never delivering. The only delivery in Thailand is Chris.

[NeilSA1]

He's offering - in Thailand, he is offering. Thais are always "offering" but never delivering. The only delivery in Thailand is Chris.

Now, who is Chris ?

[lostsoul49]

Here is the real problem.

My father in law has a friend who owns a rice mill in korat province.

He can't touch any of the rice until it has been inspected which is due on 25th of this month and will conclude after 3 days.

After his rice has been inspected, it will be released, problem is... It belongs to the government and his warehouse is 80% full and can't move any till the commerce ministry calls for it and that may not happen for another year as there is a queue.

Come mid September he is expecting the rice farmers to start approaching the mill to sell their rice and the reality is that he can only take 20% of what he normally takes and that is the exact same story across all the other mills in the province.... they are stacked out and can't take the rice.

The problem is that the rice farmers are going to be stuck with a hell of a lot of rice they can't sell and the farmers are going to go mental.

You think the last year was bad with a million not getting paid.... It is nothing compared to 4 million not being able to sell most of their rice. The big farming companies will be the ones the mills will work with for the little space there is, the little farmer is going to be ignored as they have no 'influence'.

Get ready for some major farmer protests.

We all know who is the one to blame, but I bet the Junta take all the flak for locking down the warehouses to inspect the scam.

Reality is though.... they have 18 million tonnes to get rid of and that is 2 good years of selling.... they have another 20 million tonnes about to be harvested that they can't sell.

[Thai at Heart]

Here is the real problem.

My father in law has a friend who owns a rice mill in korat province.

He can't touch any of the rice until it has been inspected which is due on 25th of this month and will conclude after 3 days.

After his rice has been inspected, it will be released, problem is... It belongs to the government and his warehouse is 80% full and can't move any till the commerce ministry calls for it and that may not happen for another year as there is a queue.

Come mid September he is expecting the rice farmers to start approaching the mill to sell their rice and the reality is that he can only take 20% of what he normally takes and that is the exact same story across all the other mills in the province.... they are stacked out and can't take the rice.

The problem is that the rice farmers are going to be stuck with a hell of a lot of rice they can't sell and the farmers are going to go mental.

You think the last year was bad with a million not getting paid.... It is nothing compared to 4 million not being able to sell most of their rice. The big farming companies will be the ones the mills will work with for the little space there is, the little farmer is going to be ignored as they have no 'influence'.

Get ready for some major farmer protests.

We all know who is the one to blame, but I bet the Junta take all the flak for locking down the warehouses to inspect the scam.

Reality is though.... they have 18 million tonnes to get rid of and that is 2 good years of selling.... they have another 20 million tonnes about to be harvested that they can't sell.

This is interesting. Can I ask, what he has on hand? Paddy rice, or milled rice?

If he is going to move it, where are they going to put it? Because if he is full, you can guarantee everywhere is full. They surely didn't build enough new housing to take all this stuff.