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Cooperative in Trang freezes purchase of rubber sheets
KANITA SEETONG,
JEERAPONG PRASERTPHONKRANG
THE NATION

Low prices, high stocks aggravate problems faced by farmers, traders

BANGKOK: -- THE TRANG Rubber Cooperatives Assembly has suspended any purchase of smoked rubber sheets at least until today, leaving local rubber farmers and small traders reeling.

The suspension could also be extended in the face of low rubber prices and difficulty in selling rubber products already in stock.

The problems continue even after several banks, in response to the government policy, have agreed to offer soft loans to buyers of rubber latex.

"We will allow loan amount of up to Bt16 billion. So we believe the rubber price should go up to around Bt80 per kilogram within two months," Deputy Prime Minister and Defence Minister Prawit Wongsuwan said after chairing a meeting on how to tackle poverty and reduce equality in Thai society.

The government has now offered to keep the rubber-sheet price at the rate of Bt64.5 per kilo through a subsidy of Bt1,000 per rai. Local rubber growers in Trang province, however, say their rubber latex can fetch only between Bt35 and Bt36 per kilo because 40 rubber cooperatives under the assembly are already suffering from cash-flow problems.

Sompoj Chaithong, a trader in rubber latex, said he had been struggling hard to keep himself and his associate rubber growers afloat in such difficult times.

"I have my own network of local rubber growers. If I don't buy rubber latex from them to make rubber sheets, they will be in trouble," Sompoj said.

"But now, I end up owing Bt300,000 to loan sharks because I can't sell what's in stock".

Stuck with stocks

Sompoj now has stocks of about six tonnes of rubber sheets, worth around Bt1million.

He said the Trang Rubber Cooperatives Assembly could not buy any more rubber sheets from him because of its financial problems.

He had tried but failed to sell the sheets to the central market in Hat Yai Central Rubber Market in Songklha province.

Sompoj said his family was now paying Bt9,000 in interest to loan sharks each month.

He said if the government did not solve the rubber problems quickly, he would certainly join a rubber-farmer rally when it was held.

Source: http://www.nationmultimedia.com/national/Cooperative-in-Trang-freezes-purchase-of-rubber-sh-30253443.html


-- The Nation 2015-02-05

[smutcakes]

hmmmm, surprised this topic is so quiet.

[maoro]

Yes, well we get only 15 baht in Buriram

[Toknarok]

It's the dry season now here in the Northeast and the rubber farmers have stopped tapping. This may ease the situation a little. Doesn't alter the fact that there is far too much rubber being produced and that farmers should seriously consider turning to other crops. Problem is what? World prices for most of the agricultural produce in Thailand are very low. Palm oil might be a goer but what happens when there is a glut of that?

[Shiver]

"...tackle poverty and reduce equality in Thai society".

?!?

[halloween]

So nothing to do with bed-wetting or golden showers?

[halloween]

Yes, well we get only 15 baht in Buriram

Sounds like you've been short-sheeted.

[retarius]

Silly me and I thought that this had to do with fetish play....

[Robby nz]

Don't see how anyone can blame the present administration for this.They have no control over world rubber prices or demand.

On the one hand we have those who are saying the govt should be paying the farmers and the same people saying subsidies are bad.

There seems to be no quick fix for this and other than giving the farmers money or buying rubber at inflated prices and storing it in the hope of price rises (a-la rice pledging) what can a Govt do ?

Several years back when the price of rubber was high farmers were encouraged to plant rubber trees (subsidy ?), now the trees have come into production and there is an oversupply.

Someone says grow something else, but that means cutting down productive trees and clearing the land for another crop, but is this going to create an oversupply of something else ? And besides there is a lead in time before any income can be derived from a subsequent crop.

I see in my travels that rubber saplings are still being planted in places but in most cases there are crops being planted in the rows, pineapples are one. must take some photos next week.

It could be that these saplings are to replace trees that have come to the end of their productive life to ensure continuity of income.

I don't have any answers to this other than some smoothing mechanism to keep prices stable but this would mean that when prices were high farmers would still get an average which would be less than the high market price, I doubt they would be happy with that.