Rubber growers to meet agriculture minister for help

[Lite Beer]

Rubber growers to meet agriculture minister for help

BANGKOK: -- Representatives of rubber growers from across the country will tomorrow (Monday) converge at the Ministry of Agriculture and Agricultural Cooperatives to seek government’s help to shore up the steady declining rubber prices.

The prices of raw rubber sheets have dropped to record low in seven years at 46-47 baht a kilogramme compared to the production cost of 65.25 baht per kilograme, said Mr Uthai Sornlaksap, president of the Rubber Council of Thailand, today.

He added that rubber growers are now losing 20 baht for every kilogramme of rubber sheets they produced forcing several of them to recall their children from schools because they can no longer afford the tuition fees and several more have their pickup trucks seized by car dealers because of instalment payment defaults.

However, he assured that the rubber growers would not resorting to blocking highways as they did during the previous government but would bring their grievance to the government’s attention so that some measures should be meted out to help the rubber growers.

Meanwhile, Agriculture Minister Pittipong Pungbun na Ayudhya said that the government did not ignore rubber growers’ hardship and would try to help out.

He promised to bring the rubber growers’ problem to the attention of the National Rubber Committee headed by Prime Minister Prayuth Chan-ocha. He also hinted that the government would try to help by reducing the production costs.

Source: http://englishnews.thaipbs.or.th/rubber-growers-meet-agriculture-minister-help/

-- Thai PBS 2014-09-14

[EricBerg]

Hmmm. Perhaps buy all the rubber from them. For way above international market price. Then store the rubber. Build up a huge stock. Dump it on the market. Crush the competition. Then control the world market and push up the price big time. But first make them promise to vote for my new party when the time comes. Everybody happy then. There's a great plan.

[khwaibah]

Charcoal.

[cornishcarlos]

Its just bad news following bad news these days...!!!

Maybe the volleyball team will keep national pride alive..?

[ratcatcher]

I hope Minister Pittipong Pungbun ( what a lovely bouncy name ) na Ayudhaya, will show some flexibility with the rubber farmers, but not as flexible as the rice farmers found.

[tonbridgebrit]

"However, he assured that the rubber growers would not resorting to blocking highways as they did during the previous government but would bring their grievance to the government’s attention so that some measures should be meted out to help the rubber growers."

And that is one of the benefits of this present government. There will be no disruptions, no blocking of roads, no taking over airports, none of this stuff.
And that's how they do things in China. Any taking over of anything, well, it won't happen, because it will be prevented from happening in the first place.

Actually, back home in England, and in America, I think the government also won't tolerate a load of people taking over an airport or the city centre. Makes you wonder why this nonsense was allowed to happen previously in Thailand.

And in Hong Kong, some people wanted to lay siege to Hong Kong's financial district. I think they called themselves "Occupy Central". In the end, it didn't happen, because, because of lack of interest. Basically, not enough people could be bothered to show up and take part in the blockade. Well, Hong Kong people, they're pretty sensible actually. No need to have any threats to stop a bunch of Chinese in Hong Kong who are about to carry out a blockade. They won't do it, because they know it don't make sense.

[bangkokfrog]

Tom is correct. I am sure there would have been talk about blocking highways under any other government. This is the only protest tool that seems to have worked for them in the past. Rubber production is a long term investment and market prices will go up and down. Does anyone know if Thai rubber farmers are inefficient in regional terms like the rice farmers? To me, this is what should determine the government's reaction. If they are efficient, give temporary assistance to reduce costs until prices recover. If not efficient, either work on improving competitiveness or give incentives to move on to another crop. But whatever happens, the government should avoid at all costs buying and storing rubber at inflated prices!

[DrLom]

Time to leave rubber plantation growing and turn to a new source of income, if making such losses and not even anywhere near even breaking even, methinks?

[rreddin]

I hope Minister Pittipong Pungbun ( what a lovely bouncy name ) na Ayudhaya, will show some flexibility with the rubber farmers, but not as flexible as the rice farmers found.

Nice puns, but what is really required is some assistance to enable rubber growers to exit the industry and move into profitable agricultural sectors. Subsidising the rubber growers is only sustainable in the very short-term. There is global over-supply, which, from what I have seen on this forum, will only get worse as large new plantations in neighbouring countries come into production.

Edited to correct a typo.

Edited September 14, 2014 by rreddin

[tingtong]

I hope Minister Pittipong Pungbun ( what a lovely bouncy name ) na Ayudhaya, will show some flexibility with the rubber farmers, but not as flexible as the rice farmers found.

Nice puns, but what is really required is some assistance to enable rubber growers to exit the industry and move into profitable agricultural sectors. Subsidising the rubber growers is only sustainable in the very short-term. There is global over-supply, which, from what I have seen on this forum, will only get worse as large new plantations in neighbouring countries come into production.

Edited to correct a typo.

Seems that just a few short years ago the very same rubber farmers got that some assistance to enter the industry. Non complained then.

Instead of sending the kids out to expensive schools, or buying fancy pickups when 'the sun was shining' on them, probably that would be the time to keep a bit the old life, and save up for 'the rainy days'.

Government schools -while not top quality- still free for the kids.

Old pickups aren't that expensive. Anyway they wont risk scratching the brand new, that's purpose to show off to the neighbors.

And finally, the way of cutting cost bellow even those Burmese workers: start cutting themselves too.

Anyway, small farmers never lived off from their 5-10 rai of rubber, even when prices were high...and I don't those with 500-1000+ rai will have to starve.

[ramrod711]

He promised to bring the rubber growers problem to the attention of the National Rubber Committee headed by Prime Minister Prayuth Chan-ocha. He also hinted that the government would try to help by reducing the production costs.

How about inviting the people to participate, to share ideas. I'm sure that there must be uses for rubber domestically, for example, millions of rubber rafts could be manufactured for the people who get flooded out of their homes every year. Expensive perhaps, but no government is doing anything else for the flood victims.

[Toknarok]

Much of the rubber produced today is sourced from petroleum products, not latex. Depending on the price of oil it is often cheaper to produce things such as tyres from oil rather than latex. The price of oil is low at the moment so rubber product manufacturers will be using oil rather than latex. Things may improve for Thai rubber producers should the price of oil increase, but frankly I doubt it, there is a glut at present. Things will only get worse when the huge Chinese plantations come into production very shortly.

[chainarong]

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Tom is correct. I am sure there would have been talk about blocking highways under any other government. This is the only protest tool that seems to have worked for them in the past. Rubber production is a long term investment and market prices will go up and down. Does anyone know if Thai rubber farmers are inefficient in regional terms like the rice farmers? To me, this is what should determine the government's reaction. If they are efficient, give temporary assistance to reduce costs until prices recover. If not efficient, either work on improving competitiveness or give incentives to move on to another crop. But whatever happens, the government should avoid at all costs buying and storing rubber at inflated prices!

If you are in a losing market where technology is taking away old fashioned methods, go try something else , trouble is in Thailand they neither have the knowledge or the fortitude to move on.

[maoro]

Just a few years ago the government was encouraging farmers to grow rubber.

After 7 to 8 years the farmers were able to harvest this crop. It was hard for many to change to rubber as they had to take away another crop and then wait so long for a return. The farmers lost money while waiting for the rubber to be ready to harvest.

Easy for some TV members to say plant another crop but the fact is given the above there is too much investment in the plantation to just throw it away.

[Ulic]

The government should pay farmers a subsidy to cut trees down, not plant new ones.

[alant]

are they allowed to converge on the ministry or will there be less than the maximum allowed by law (?6). Strikes me that this is one of the problems, inconsistency. There is another stream on rubber complaining about the huge % the middlemen take but I hear no mention of controlling this here. What is the problem?

[steve73]

Much of the rubber produced today is sourced from petroleum products, not latex. Depending on the price of oil it is often cheaper to produce things such as tyres from oil rather than latex. The price of oil is low at the moment so rubber product manufacturers will be using oil rather than latex. Things may improve for Thai rubber producers should the price of oil increase, but frankly I doubt it, there is a glut at present. Things will only get worse when the huge Chinese plantations come into production very shortly.

Natural latex can be replaced with (and vv. can replace) petroleum based rubbers (butadiene) for many (but not all) applications....and historically there has usually been some relationship between latex and oil price

As the oil price increased substantially in the early-mid 2000's (from around $10bbl in '99 to almost $150 in '07) the rubber price followed... There was HUGE worldwide investment into rubber plantations during the last few years of that spike, and lo-and-behold, 7 to 8 years later all that investment is at last bearing fruit, and exceeding the demand for the natural product.

At c. $100/bbl, I wouldn't say the OP is particularly low at present, but natural latex supply IS now exeeding its demand and so the latex relationship to OP is no longer applicable.

Also, for the same reasons, land suitable for rubber has increased in price significantly here in T/L, perhaps 3-4x in traditional rubber growing areas, and as much as 20-30x in some areas new to the crop (which in turn has pushed up the prices of the tradional crops in those areas). There are some signs that land prices will fall back in the coming years, and I agree, the situation will only continue to get worse.

[Boxclever]

What they should do is pressure the government to apply sweeping subsidies to all the southern rubber farmers in exchange for votes at the next elections and if they agree and it all turns tits up, charge the government officials with incompetence and send the lot of them to jail.

[rickirs]

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What they should do is pressure the government to apply sweeping subsidies to all the southern rubber farmers in exchange for votes at the next elections and if they agree and it all turns tits up, charge the government officials with incompetence and send the lot of them to jail.

Unfortunately, under martial law the the Army-appointed government officials (many of whom are active military) would be called to a military court for trial; that is if the Supreme Commander allowed it.

[halloween]

What they should do is pressure the government to apply sweeping subsidies to all the southern rubber farmers in exchange for votes at the next elections and if they agree and it all turns tits up, charge the government officials with incompetence and send the lot of them to jail.

Rice was doing quite well at the time and the only pressure for the Thaksin and Yingluk governments to apply sweeping subsidies was their own lust for power and the billions that government allowed them to steal.

[kerrysum]

No need to explain this to me, just ask my sister-in-law in Mukdahan... I'm going to be a millionaire! NOT. But then again, it has always been this way in Thailand for years. Who makes the real money? The money lenders..... kilosierra

In a squeeze? We can loan, how about 22%, guess you cannot borrow your way to prosperity....

[thaiguzzi]

Some of the info above is correct. A lot is incorrect.

#approx 51-56% of rubber products currently made worldwide are synthetic (ie oil) based.

# All tyres have some natural rubber content in, the higher the quality tire, the more the latex content ie racing car/motorcycle tires, aircraft tires etc.

# The middlemen are not stiffing the farmers. They make very little %age per deal. the price is what it is, and is generally set by the Japanese and Singapore stock markets.

# further info can be gleaned from websites such as Global Rubber Markets etc.