Thread: Thailand Plans Moves to Support Rice Prices

Sam same but different.

Local Farmers Would Be Given Low-Interest Loans to Keep Some Rice in Storage


BANGKOK—Thailand’s national rice policy committee said it plans to introduce measures to delay the sale of some rice from the coming harvest to try to support prices.

Local farmers would be offered low-interest loans in exchange for keeping their Hom Mali—commonly called Thai jasmine rice—and parboiled rice, to be harvested in November and December, in storage, Deputy Prime Minister Pridiyathorn Devakula told reporters after the committee’s meeting.

The goal is to prevent rice prices from falling, said Mr. Pridiyathorn, a member of the committee. Supplies of fresh, newly harvested rice tend to pressure the price of older grain.

The measures include lending farmers most of the price they would receive if they sold their rice, and giving millers loan incentives to encourage them to buy and store lower-grade white rice—different than jasmine and parboiled rice—until the prices are favorable.

The measures, to be proposed to the Cabinet on Tuesday, are expected to be approved. Prime Minister Gen. Prayuth Chan-ocha, who led a military coup d’etat that ousted Yingluck Shinawatra ’s government in May, chairs the rice committee.

Thailand is currently the world’s second-largest rice exporter, after India. It had held the top spot, but lost that position after Ms. Yingluck’s government introduced a rice subsidy about three years ago that involved buying rice from farmers at above-market prices and withholding it from international sale.

The program’s failure contributed to the bringing down of Ms. Yingluck’s government. Gen. Prayuth has ruled out any program similar to the rice subsidy, but has offered indirect support, such as cheap fertilizer and low-interest loans to reduce production costs. He said Monday that rice prices “are not high enough.”

The next rice harvest, due by the last quarter of this year, is expected to weigh in at 27 million tons. About 15 million tons of that will be Hom Mali and parboiled rice. The rice committee is targeting the two types of rice for special treatment because their market rates have been relatively stable.

The price of top-grade Hom Mali rice has dropped about 1% over the past four weeks to about $1,070 per metric ton, while that of parboiled rice has been relatively unchanged, quoted at around $435 per metric ton, according to the Thai Rice Exporters Association.

The military government is sitting on an estimated 18 million metric tons of rice. Keeping new rice off the market could improve the prospects for sale of those stockpiles.

The price of Thai rice began falling late last year when Ms. Yingluck pushed to sell state rice stocks to raise funds after her subsidy plan ran into cash-flow problems. Many farmers, who are a powerful political constituency, went unpaid for months.

The prices rebounded after the military seized power on May 22 and ordered a two-month suspension of state rice sales. However, farmers complained that they received about $30-$100 less than their target prices of about $277-$300 a ton.

The rice committee will propose that the state-run Bank of Agriculture and Agricultural Cooperatives offer farmers up to 80% of the value of their Hom Mali and parboiled rice in low-interest loans if they choose to keep the grain out of the market.

Interest-rate incentives will be offered to local millers to buy and store six million to seven million tons of low-quality white rice in their warehouses. The millers can sell the rice when market conditions are appropriate, Mr. Pridiyathorn said.

Last week, the Cabinet approved a one-time payment of about $1.2 billion in cash to help 3.4 million rice-farming families.

The direct cash handouts were welcomed by the World Bank.

“The subsidy is specifically targeting poor farmers and it’s a one-time payment,” Ulrich Zachau, the World Bank country director for Southeast Asia, said Monday.

The Thai Commerce Ministry said it expects that it will take about three years to sell the state rice stocks.

The fact that Thai rice is priced competitively is expected to boost exports this year to about 10 million tons, according to the Thai Rice Exporters Association. Thai white race containing about 5% broken grains, the most common grade, is quoted around $425 a ton, about $25 cheaper than similar rice from Vietnam. Rice exports in the first eight months of 2014 grew by almost 60% compared with the same period last year, to 6.6 million tons, due to strong demand and the resumption of state rice sales, the association reported.

The ruling military government approved two rice tenders in August and September. Combined sales from the tenders totaled about 140,000 tons.

Meanwhile, Ms. Yingluck remains under threat over her handling of the rice subsidy. The country’s anticorruption panel said it is considering asking the military-appointed legislature to impeach Ms. Yingluck for mismanaging the subsidy. That could prevent her from running for any political office for five years. She has repeatedly denied the allegations.

Thailand Plans Moves to Support Rice Prices - WSJ

Same same but different. Exactly.

Ummmmmm do they not realise that they are frankly too dumb to be able to manipulate the global rice price? Last time they tried it... well we know how that ended. Prepare for Vietnam to ramp up production even more.

Very different..
The farmer is getting a loan so he can keep the rice and sell it when the price peaks. He is responsible for storing it, he is responsible for selling it.
Corruption impossible.

Millers to be given loan incentives to encourage them to buy and store lower-grade white rice. No corruption possible by the millers, lom?

And if they keep it to long its knackered or they bring down price of rice and farmer loses more.


looks like rice prices will fall more considering other countries producing more.

Originally Posted by lom

Very different..
The farmer is getting a loan so he can keep the rice and sell it when the price peaks. He is responsible for storing it, he is responsible for selling it.
Corruption impossible.

Originally Posted by pseudolus

Ummmmmm do they not realise that they are frankly too dumb to be able to manipulate the global rice price? Last time they tried it... well we know how that ended. Prepare for Vietnam to ramp up production even more.

The once famous Thai influence has been destroyed forever.

Seems the govt are reneging on there promise of rice prices PYB announced this morning that rice will be bought at 10 baht per kg.

BAAC where around the other day saying they not know what is going to happen with rice promises.

All this plays into the hands of the wealthy land owners who can afford proper grain storage facilities, running the small farmers out off business.

Next thing you know GMO strains of rice will be cultivated.

The handwriting is already on the wall:
Genetically Modified Rice

Thailand plans moves, hold your breath.

Doing same for rubber growers...dead end for both products.