The National Rice Policy Committee chaired by Prime Minister Prayut Chan-o-cha yesterday approved a 10-billion-baht budget to restructure rice management for the 2016 crop year.
The new comprehensive rice management plan will cover production, sales and financial support, aimed at addressing oversupply, stabilising prices and increasing production standards.
"This is the first time the government, private sector and farmers have joined together on a rice management plan," said Chutima Bunyapraphasara, permanent secretary for commerce.
Ms Chutima said of the total budget, 3.3 billion baht would be set aside to convince farmers to cut their paddy production and grow premium rice and other crops in lieu of white rice, with the remainder earmarked to stabilise rice prices if local rice prices fall.
The new rice management plan calls for farmers to cap their production at only 27 million tonnes of paddy this year, down from an average of 30 million tonnes.
The Agriculture Ministry expects 60,000 families will join the project to grow other crops, reducing rice farmland by 300,000 rai.
The plan also calls for promoting farmers to grow Thai Hom Mali fragrant rice in 20 provinces as well as growing crops that can improve the quality of soil covering 500,000 rai in 22 provinces, a scheme that would cover 25,000 families.
Under the rice management plan, the government would also subsidise a 3.9% interest rate for farmers who form "megafarm projects" for one year, with the loans extended by the Bank for Agriculture and Agricultural Cooperatives.
The megafarm project would see a list of participatory farmers compiled, with modern equipment deployed during the farming, including harvesting machinery.
Participating farmers would pay only 0.1% of the bank's interest rate, with each group allowed to borrow a total of 5 million baht. This scheme is estimated to cost the government a budget of 83 million baht.
The Agriculture Ministry is scheduled to propose the plan for cabinet approval later in the year.
As part of the rice management plan, the committee yesterday also assigned the Agriculture Ministry to work out ways to promote rice consumption among Thais, as a survey found Thai rice consumption in the past 10 years fell sharply to 106 kilogrammes per head per year from 190kg.