30 billion baht loan to shore up falling rubber prices

[webfact]

30 billion baht loan to shore up falling rubber prices



BANGKOK: -- The Ministry of Agriculture and Agricultural Cooperatives is to seek approval from the National Council for Peace and Order for a 30 billion baht loan for agricultural institutions and business operators to buy rubber from the growers for conversion into rubber products.

The loan is expected to help shore up rubber prices which have been falling during the past week.

Agriculture Permanent Secretary Mr Chavalit Chukachorn assured that the ministry has not yet offloaded rubber from its stockpile – a move which will further dampen rubber prices.

Meanwhile, Mr Anant Daladom, president of the Plants Association of Thailand, urged the government to speed up the promotion of converting raw rubber into rubber products in order to add value to rubber.

The Office of Rubber Welfare Fund will introduce a 7-year measure to replace old rubber trees with high-yield strains in 400,000 rai of rubber plantations and to look for new markets for rubber to prevent price suppression by the middlemen.

On longer-term measure, the office will promote the replacement of rubber plants with other cash crops such as oil palm by rubber growers who will be subsidized by 16,000 baht per rai.

Source: http://englishnews.thaipbs.or.th/30-billioin-baht-loan-shore-falling-rubber-prices/


-- Thai PBS 2014-08-21

[jpinx]

Sounds like the now-defunct rice scheme was just one of these crazy ideas. I never understand the thinking behind these....

[chotthee]

Sounds like the now-defunct rice scheme was just one of these crazy ideas. I never understand the thinking behind these....

Part of Suthep's (a southern) promise.

[khwaibah]

Guess they did not learn from the rice debacall.

[tonbridgebrit]

Why the massive condemnation of Thailand's attempt to subsidise rice and rubber ?

In Japan, they have massive barriers against American rice, if they didn't, well, most of Japan's rice farmers would be bankrupt. And South Korea is in a similar situation.
How many billions does the EU (or they use to, anyway) spend on farm subsidies ?

Why have pop at Thailand, when basically, a whole load of other countries do similar things ? Are we going to have a pop at the other countries ?

[pookiki]

POPULISM!!! Arrrgh No disagreement with the plan. Just hilarious (and sad) to watch the junta and other agencies implement the same programs that were the basis for toppling the former government.

Edited August 21, 2014 by pookiki

[jpinx]

I wasn't popping at Thailand, but I was popping at the whole concept of government subsidies in any country. What happened to the simple logic of selling what you grow to the consumers? You're right -- EU, UK, USA; NZ; Oz, etc all do it, but why?

[iancnx]

Where it all went wrong was the huge investment here (on borrowed funds) in planting rubber with the hope of buoyant exports in the future. No consideration was given to the ongoing huge rubber investment in Southern China which is now coming on-line. The Chinese importation requirement has reduced significantly. There is now a simple supply and demand issue. There is an oversupply in Thailand, and just wait to see what happens to the market over the next 5 years. Rubber planted here will be fortunate to become viable. I was approached 4 years ago to invest, with a glowing business plan showing huge returns after 7 years. 18 hrs internet research led me to telling that particular chap he was barking mad. I have seen millions of baht poured into hundreds of plantation in N.Thai. It takes 7 yrs for a tree to fully mature. 7 years of fertiliser, husbandry and security. This can only end very very badly.

[chotthee]

POPULISM!!! Arrrgh No disagreement with the plan. Just hilarious (and sad) to watch the junta and other agencies implement the same programs that were the basis for toppling the former government.

Not populism.

It is call: the great leader care and help fellow country man.

[worgeordie]

Supply and demand,why not follow that principle,why has the majority

have to subsidize the minority,whats next,corner shops that cannot

make a living,subsidize those as well?.

Demand from China is down,production up,prices have to fall,basic

economics,but then governments have to get involved and throw tax

payers money at the problem,happens the world over.

regards Worgeordie

[Phuket Stan]

I wasn't popping at Thailand, but I was popping at the whole concept of government subsidies in any country. What happened to the simple logic of selling what you grow to the consumers? You're right -- EU, UK, USA; NZ; Oz, etc all do it, but why?

Nope....u r wrong....NZ stopped subsidies to farmers in 1984....was done by a left wing government...many squells etc but it made the farmers much more productive...in as much I think they now lead the world in productivity

[iancnx]

Supply and demand,why not follow that principle,why has the majority

have to subsidize the minority,whats next,corner shops that cannot

make a living,subsidize those as well?.

Demand from China is down,production up,prices have to fall,basic

economics,but then governments have to get involved and throw tax

payers money at the problem,happens the world over.

regards Worgeordie

Unfortunately here the government actively promoted the planting of rubber, and if I remember correctly offered huge subsidised preferential loans for Thai farmers to get stuck in. When the latex finally flows, they are gonna be stuck in alright. Stuck in to a lifetime of un-payable debt. The winners will be those that get into manufacturing rubber components...... Business opportunity there! Good luck. Poor bastar'ds.

[pookiki]

POPULISM!!! Arrrgh No disagreement with the plan. Just hilarious (and sad) to watch the junta and other agencies implement the same programs that were the basis for toppling the former government.

Not populism.

It is call: the great leader care and help fellow country man.

Given you quote from 1984, I will accept your post as satire. If it isn't, I respectfully suggest that you look up the definition of 'populism'.

The great leader is following in the footsteps of many who wanted to help the rural poor.

[Always18]

I think I see the (Thai) logic here...................massive oversupply leads to a fall in the world price of rubber so the answer is to introduce enormous subsidies to bale out those growers that gambled on high prices and, at the same time apparently, start cultivating high-yield strains of rubber tree to produce even greater amounts in the future.....................really priceless!

[jpinx]

I wasn't popping at Thailand, but I was popping at the whole concept of government subsidies in any country. What happened to the simple logic of selling what you grow to the consumers? You're right -- EU, UK, USA; NZ; Oz, etc all do it, but why?

Nope....u r wrong....NZ stopped subsidies to farmers in 1984....was done by a left wing government...many squells etc but it made the farmers much more productive...in as much I think they now lead the world in productivity

My apologies for lumping you Kiwis in with the the rest of the bad lot

[iancnx]

I think I see the (Thai) logic here...................massive oversupply leads to a fall in the world price of rubber so the answer is to introduce enormous subsidies to bale out those growers that gambled on high prices and, at the same time apparently, start cultivating high-yield strains of rubber tree to produce even greater amounts in the future.....................really priceless!

Or financiers knowing exactly when to short rubber!

[airconsult]

I think I see the (Thai) logic here...................massive oversupply leads to a fall in the world price of rubber so the answer is to introduce enormous subsidies to bale out those growers that gambled on high prices and, at the same time apparently, start cultivating high-yield strains of rubber tree to produce even greater amounts in the future.....................really priceless!

Or switch to palm oil - there was a huge glut on the market (globally) of palm oil 3/4 years ago - the end-result was discontinuing benzine 91 to force people to use gasohol 91 and use up the excess palm oil - utter madness.

Why not try to find a product that is actually needed and demands a high price????

[pisico]

Sounds like the now-defunct rice scheme was just one of these crazy ideas. I never understand the thinking behind these....

Part of Suthep's (a southern) promise.

A re-tooling of an old Suthep scandal. What is next? Palm oil "subsidy"?

The country has seen that movie before. Money will vanish mysteriously... TIT

[pisico]

I think I see the (Thai) logic here...................massive oversupply leads to a fall in the world price of rubber so the answer is to introduce enormous subsidies to bale out those growers that gambled on high prices and, at the same time apparently, start cultivating high-yield strains of rubber tree to produce even greater amounts in the future.....................really priceless!

Or switch to palm oil - there was a huge glut on the market (globally) of palm oil 3/4 years ago - the end-result was discontinuing benzine 91 to force people to use gasohol 91 and use up the excess palm oil - utter madness.

Why not try to find a product that is actually needed and demands a high price????

That is not madness. Thailand is not capable of being competitive. Blame it on us. The world continued flocking to Thailand to dump here money despite of the Xenophobia, leonine laws about business and investment and the country became complacent because they are, Oh, so special!.

The time will come when Thailand will argue unfairness in ASEAN to pull out of it because the country's mindset does not incorporate competitiveness in their global MO. The powers that be and the population at large are unable to understand the need to be competitive. Only a crisis that hits the pocketbook will make Thailand accept the inevitable: be competitive, eat your pride or degrade into being a Third world country. The mentality already exists.

[airconsult]

I think I see the (Thai) logic here...................massive oversupply leads to a fall in the world price of rubber so the answer is to introduce enormous subsidies to bale out those growers that gambled on high prices and, at the same time apparently, start cultivating high-yield strains of rubber tree to produce even greater amounts in the future.....................really priceless!

Or switch to palm oil - there was a huge glut on the market (globally) of palm oil 3/4 years ago - the end-result was discontinuing benzine 91 to force people to use gasohol 91 and use up the excess palm oil - utter madness.

Why not try to find a product that is actually needed and demands a high price????

That is not madness. Thailand is not capable of being competitive. Blame it on us. The world continued flocking to Thailand to dump here money despite of the Xenophobia, leonine laws about business and investment and the country became complacent because they are, Oh, so special!.

The time will come when Thailand will argue unfairness in ASEAN to pull out of it because the country's mindset does not incorporate competitiveness in their global MO. The powers that be and the population at large are unable to understand the need to be competitive. Only a crisis that hits the pocketbook will make Thailand accept the inevitable: be competitive, eat your pride or degrade into being a Third world country. The mentality already exists.

Sorry, I disagree - Thailand is capable of being competitive in many things - take high-tech manufacture (Western Digital), or cars? (Ford, Toyota - not all local taxes apply to export).

The fact is that the agriculture ministry does not advise and instruct farmers on what would be good crops properly. Instead they just seem to read the daily newspaper, ignore future market predicitions, and hope they'll be money to bail out the farmers that followed their advice later.

[pisico]

I think I see the (Thai) logic here...................massive oversupply leads to a fall in the world price of rubber so the answer is to introduce enormous subsidies to bale out those growers that gambled on high prices and, at the same time apparently, start cultivating high-yield strains of rubber tree to produce even greater amounts in the future.....................really priceless!

Or switch to palm oil - there was a huge glut on the market (globally) of palm oil 3/4 years ago - the end-result was discontinuing benzine 91 to force people to use gasohol 91 and use up the excess palm oil - utter madness.

Why not try to find a product that is actually needed and demands a high price????

That is not madness. Thailand is not capable of being competitive. Blame it on us. The world continued flocking to Thailand to dump here money despite of the Xenophobia, leonine laws about business and investment and the country became complacent because they are, Oh, so special!.

The time will come when Thailand will argue unfairness in ASEAN to pull out of it because the country's mindset does not incorporate competitiveness in their global MO. The powers that be and the population at large are unable to understand the need to be competitive. Only a crisis that hits the pocketbook will make Thailand accept the inevitable: be competitive, eat your pride or degrade into being a Third world country. The mentality already exists.

Sorry, I disagree - Thailand is capable of being competitive in many things - take high-tech manufacture (Western Digital), or cars? (Ford, Toyota - not all local taxes apply to export).

The fact is that the agriculture ministry does not advise and instruct farmers on what would be good crops properly. Instead they just seem to read the daily newspaper, ignore future market predicitions, and hope they'll be money to bail out the farmers that followed their advice later.

Capable? Why there is not a Thai company competing with Western Digital (foreign investment). Why there is not a single Thai car factory producing cars designed, built by Thais and with only Thai money? Ford, Toyota represent foreign investment.

If Thais are capable (as you assert) why don't they do it?

The equivalency you are trying to establish between agriculture and industry is not based on facts. Thailand is primordially an agricultural country which continues with their feudal traditional ways. Second, a cheap source of relatively inexpensive labor force for foreign investment (Western Digital, For, Toyota). Third a country that gets around 9 to 10 % GDP depending on the circumstances of the moment.

That is all what Thailand has demonstrated is capable of.

To be capable is such a blanket statement! Capable yes, but it is not.

[scorecard]

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POPULISM!!! Arrrgh alt=tongue.png> No disagreement with the plan. Just hilarious (and sad) to watch the junta and other agencies implement the same programs that were the basis for toppling the former government.

Not populism.

It is call: the great leader care and help fellow country man.

Given you quote from 1984, I will accept your post as satire. If it isn't, I respectfully suggest that you look up the definition of 'populism'.

The great leader is following in the footsteps of many who wanted to help the rural poor.

And who are these 'many who wanted to help the rural poor'?

[bangrak]

Sounds like the now-defunct rice scheme was just one of these crazy ideas. I never understand the thinking behind these....

Part of Suthep's (a southern) promise.

Aha, so, according to you it was not during the 'Thaksin regime' that farmers were pushed to switch from rice to rubber, with money offered to, and sapplings by the millions, and the usual corruption? Did I get that wrong, or...? Wasn't it another populist masterplan from the Pr. Dr. in Dubai now?

Thailand's gonna control the world market of rice, and the world market of rubber... look now where the country stands! Blind theories made up in one crazy man's head for his own glory (and money...), totally ignoring there are other countries in the world, also producing rice, rubber, etc. Welcome to the lunatics' house!

[bangrak]

And look what the a..holes of 'specialists' from the Min of Agriculture come up with! Replace older rubber trees by new ones producing more latex, while there is already overproduction worldwide, and what about the millions of farmers who have producing rubber trees now and for the next odd 10 to 20years, make their (smaller) plantations unsustainable, in favour of the big landowners and companies, how nice is that? Oh, but the morons offer an alternative: step over to oil palm! Hello, there is already overproduction of palm oil, and in most 1st world countries there are ongoing campaigns to reduce or suppress the use of palm oil in food preparations because unhealthy... What a bunch!

[bangrak]

There is too much rice, the prices fall.

There is too little rice, the prices rise.

There is too much rubber, the prices fall.

There is too little rubber, the prices rise.

It's called the law of offer and demand.

Could someone teach the Thais about this law, even when it was not invented by a Thai?

Way before money was invented, the cavemen they already knew about offer and demand...

[Prbkk]

Oh, this is far more entertaining than Yingluck's time. The buck is going to stop with whoever gets to be PM in 2015 or 2016 or 20??

[Thai at Heart]

Sounds like the now-defunct rice scheme was just one of these crazy ideas. I never understand the thinking behind these....

Part of Suthep's (a southern) promise.

Aha, so, according to you it was not during the 'Thaksin regime' that farmers were pushed to switch from rice to rubber, with money offered to, and sapplings by the millions, and the usual corruption? Did I get that wrong, or...? Wasn't it another populist masterplan from the Pr. Dr. in Dubai now?

Thailand's gonna control the world market of rice, and the world market of rubber... look now where the country stands! Blind theories made up in one crazy man's head for his own glory (and money...), totally ignoring there are other countries in the world, also producing rice, rubber, etc. Welcome to the lunatics' house!

This plan was hatched by the Thai Rubber exporters who were faced with a problem of ageing production in the South and growing unrest in the area making it risky to work there. So they went to the govt and got the plan together to migrate the crop to the North East. The plan was that a lot of plantations wouldn't be replanted in the South and would just expire and slowly production would migrate to the NE. Someone mentioned that China has started big production of rubber themselves. Hadnt heard that, but if they have, then prices will stay low for a very very long time. Big problems.

[LuckyLew]

Is this not the same thing as the populist policies as the last Govt?

How about letting market forces drive the peices

If the growers / farmers do not make enough they can change crops

[givenall]

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Sounds like the now-defunct rice scheme was just one of these crazy ideas. I never understand the thinking behind these.... alt=blink.png>

It may be too late anyways. They have find alternative to rubber from rubber tree and is from dandelion flower the weed that grows everywhere

[Boxclever]

Isn't this something like Yingluck tried to do and is now facing criminal charges??? Let's see if the Junta supports THIS one. Perhaps it's a "thank you" gesture to the people of the south for supporting the coup