CP expands premium rice seed business
Monday, April 28, 2008

In keeping with rising rice prices, the Charoen Pokphand Group, the country's largest agro-industrial conglomerate, is flexing its muscle to expand its higher quality-rice seed business.

The company has invested about 30 million baht a year for seven years in research and development of rice seeds. It owns cross-bred white rice varieties called C.P. 304 and C.P. 357.

The two hybrid varieties cultivated in irrigated areas are claimed to produce about 1,500 kilogrammes of paddy per rai, about 300 kg higher than general breeds grown by farmers.

According to Anek Silapapun, senior vice-president of CP's crop-integration business group, the hybrid varieties could reduce the farmers' harvest period to 95-115 days from 120-130 days normally.

Last year, CP encouraged farmers in Kamphaeng Phet, Phichit and Phitsanulok provinces to grow the two varieties. It provides sprouts and transplantation services as well as advice on appropriate use of fertiliser, based on the quality of soils in different areas.

The cost of sprouts and transplantation services is about 1,500 baht per rai compared with general production costs of farmers, which averaged 750 baht per rai. The prices of the two varieties are about 150 baht per kg, much higher than general varieties that are normally sold at 16 baht per kg.

According to Mr Anek, the company plans to expand the promotion to cover 4,000 rai at the end of this year.

CP is also experimenting with cross-breeding jasmine rice and expects to achieve results over the next five years.

"We expect growing demand for quality rice seeds, as farmers themselves have higher income due to the rising rice prices," said Mr Anek. "However, education to make farmers better understand the quality of seeds is still desperately needed."

He estimates demand for rice seeds among farmers nationwide at about 900,000 tonnes, but demand for high-quality seed, mostly sold by private companies, is estimated at 70,000 tonnes. The remainder represents seeds collected by farmers from the previous season.

Although Thailand is the world's largest rice exporter, its rice productivity per rai is much lower than in India, China, Indonesia, and Bangladesh.

According to a United States Department of Agriculture report released this month, Thailand's rice productivity is only 430 kg per rai, the lowest among the world's top 10 rice producers. China has the highest productivity at 1,000 kg per rai followed by Vietnam (778), Indonesia (741), India (658), Brazil (648) and Bangladesh (619).