Still 15.000 baht for a ton of paddy
Nice head in Bangkok Post today: Rice flip-flop takes flak. The headline relates to the decision of the National Rice Policy Committee (NRPC) to continue paying 15.000 baht for a ton of paddy until mid-September.
Yesterday, the committee reversed its decision two weeks ago to lower the price by 3.000 baht. According to NRPC chairman and minister Kittiratt Na-Ranong, the government has enough money to buy the 2,9 million tons of paddy from the second harvest at the old price.
The U-turn, as the newspaper calls it, proves, according to Nipon Poapongsakorn, former president of the Thailand Development Research Institute, how careless the government and the NRPC are with their policies. “The U-turn undermines the government's credibility. Surely the government must have had information on how much money it could spend before announcing the price cut. How come she comes up with two different things?'
Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, also speaks in similar terms. "What we now know for sure is that this government has no reliability whatsoever."
Kittaratt defends the U-turn; he says that 'the situation has changed'. The government is sure to have enough money to buy the rice of the second crop. In the 2012-2013 season, 345 billion baht has been spent so far, so there is still room in the approved budget of 500 billion baht.
Wichian Phuanglamjiak, president of the Thai Agriculturist Association, praised the NRPC's decision. 'It's the right decision. Farmers will meet Prime Minister Yingluck today to express their support.”
(Source: Bangkok Post, July 2, 2013)
Photos: The new Commerce Minister, Niwatthamrong Bunsongphaisan (right), is greeted by his deputy minister on his first day at work.
This is pure vote buying by the current government. Worldwide there is written about this Thai system of buying rice that can destroy Thailand financially.
I am happy for the farmers that at least another 15.000 baths are guaranteed until mid-September. That certainly gives hope for the future!
Buying votes; what I read is a little bit short-sighted!
Gr; William Sheven…
@ willem A small comment on your response. It is mainly farmers from the Central Plains who benefit from this, because they harvest twice a year. According to Bangkok Post, this concerns 200.000 farmers. For most of the farmers who participate in the mortgage system, the decision has no meaning whatsoever, because they only harvest once a year. I wonder what guaranteed price will be pulled out of the top hat for the next rice season. Still 12.000 baht per ton?
and even then I wonder if the farmers benefit from this. Probably just the traders and the grinders. The burps are ripped off on all sides; like too much moisture in the rice. Nobody can check that. The scales / bascules are also not calibrated and so on. I don't have to tell you anything right?
We should not judge Thailand too quickly, because what is the difference with the subsidies that farmers receive from the EU in Europe???
That's right, Peter, it is much cheaper to import sugar from Asia than to continue to subsidize farmers for growing sugar beets. But yes, creating jobs also costs money.
Peter: You may never justify an incorrect situation by pointing out similar incorrect things. It is remarkable that until say 5 years ago there was no price guarantee, the farmers did not complain and Thailand is the largest rice exporter in the world. Makes you think, doesn't it?
@ egon wout A small side note to your response. The rice mortgage system, reintroduced by the Yingluck government, was launched in 1981 by the Ministry of Commerce as a measure to alleviate the oversupply of rice in the market. It provided farmers with short-term income, allowing them to postpone selling their rice.
In 2005/2006 the guaranteed price was 6 percent above the market price. I have no data for the other years. The Abhisit government did not use the system.
According to Niphon Poapongsakorn, president of the Thailand Development Research Institute, only 1 million of the 3,8 million rice farmers benefit from the high guaranteed price offered by the Yingluck government; the other farmers only produce for their own consumption.