Study:Thai farmers have high costs, low incomes

BANGKOK, February 25 (TNA) - Bangkok-based University of the Thai Chamber of Commerce reports that Thai rice growers have high costs and low incomes, while Thai rice appears not to have as bright export prospect as other member countries in the Association of Southeast Asian Nations (ASEAN). Aat Pisanwanich, Director of the university's Center for International Trade Studies, told journalists of the information on Tuesday, acknowledging that there are now more players in the rice exporting business in the 10-member ASEAN bloc. Aat pointed out that neighboring Myanmar and Vietnam have become rice exporting countries, while rice importing countries, like Indonesia, the Philippines and Malaysia, do not increase their rice imports, but they are promoting their own rice cultivation and the consumption of other crops. Aat proposed that the new Thai government set up a fund to subsidize 40 per cent of local rice cultivation costs, instead of implementing the rice-pledging scheme. Aat noted that Thai rice farmers’ costs stand at about 9,763 baht per tonne, the highest among rice growers in ASEAN, while the 40 per cent subsidy amounts to 3,905 baht per tonne. Aat proposed twice subsidies yearly by the government for nine tonnes per grower, which will cost the state about 196 billion baht annually, instead of 300 billion baht yearly by the rice-pledging scheme, and the subsidy will reach growers directly while the rice-pledging scheme involves rice millers and corruption. Meanwhile, the US Department of Agriculture (USDA) predicted that Thailand should be the world’s third largest rice exporter this year, shipping 6.5-6.8 million tonnes of rice to overseas markets, a drop by 0.2-0.5 million tonnes from last year’s. According to the USDA, India should be the world's largest rice exporter in 2014, selling about 9.3 million tonnes of grains totally, while Vietnam should be the world's second largest rice exporter. Srirat Rastapana, Permanent Secretary for Commerce, said that Thailand faced a noticeable drop in Hom Mali or fragrant rice exports in January 2014, when shipments of the high quality Thai rice fell in the United States, Singapore and Hong Kong, while purchase orders for Thai parboiled rice also dropped. However, Srirat stated that her ministry is confident that the value of Thai exports should expand by 5 per cent year-on-year this year, as earlier expected, on conditions that the global economy grows by 3.7 per cent, the prices of worldwide raw materials increase by 1.3 per cent on average and the exchange rate stands at 31.5 baht a US dollar, as Thai exports to main markets, namely the United States, Europe and Japan, have grown well; while domestic political problems should affect the confidence of importing countries only in the short run. (TNA)