Rice farmers plead for help amid deep price slump

Rice farmers plead for help amid deep price slump

A group of farmers from three districts in Phichit province submit a complaint against low rice prices to the government centre through the provincial hall on Saturday. (Photo by Surachai Piraksa)
A group of farmers from three districts in Phichit province submit a complaint against low rice prices to the government centre through the provincial hall on Saturday. (Photo by Surachai Piraksa)

Rice farmers in some provinces have grown increasingly impatient and are imploring the government to help them after prices plunged to a 10-year low.

In Buri Ram, farmers say they are in deep trouble as rice prices have dipped well below cost to five baht a kilogramme. They have asked the government to help prop the prices to at least 10 baht per kg, their break-even level.

Millers are now paying them only 5,000 baht a tonne for the main crop they are harvesting, citing high humidity and impurities.

They claim the price is the lowest in decades, yet they have no choice but to accept it in order to repay debts and have money for daily expenses, harvesting equipment rentals, and school supplies for their children for the coming semester.

"We spent 70,000 to 80,000 baht to farm on our 35 rai this year. Although the output was good, it's questionable whether our income will cover the costs," said Prakong Hoopracone, 49, from Muang district of the northeastern province.

Somyot Singthongprasert shared her view, adding that if the government doesn't help them by propping up prices or controlling millers, he couldn't see how he could repay debts and meet daily expenses.

In Phichit province in the Central region, groups of farmers from three districts -- Muang, Taphan Hin and Bang Moon Nak -- gathered at the provincial hall to submit a complaint to the government's help centre. Deputy governor Piya Wongluacha accepted their letter.

The farmers said they were about to harvest jasmine rice but the price had dropped to 6,000 baht a tonne.

In Chai Nat, some farmers reportedly are putting their land up for sale because they can't bear to lose any more money on their crops.

Government spokesman Lt Gen Sansern Kaewkamnerd said on Saturday that the government was speeding up efforts to solve the problem, with the rice policy committee planning to meet on Monday.

But he dismissed some news reports as "half-truths", such as stories linking farmland sales to low rice prices.

"We've checked the facts and found that the people who are selling farmland right now are actually landlords who no longer want to rent it or those with no manpower to work the fields," he said.

Prime Minister Prayut Chan-o-cha commended farmers who have switched to other crops or joined together to form community milling cooperatives, he added.

The junta's answer to the costly rice-pledging programme of its predecessor is a barn-pledging scheme.

Aimed at slowing down the market supply of jasmine and glutinous rice paddy, the programme involves having the state-owned Bank for Agriculture and Agricultural Cooperatives (BAAC) lend to farmers in the North and Northeast.

Growers are required to keep harvests in their barns and the bank will give them loans equal to 90% of the target prices, plus 1,000 baht a tonne as the storage cost.

In return, the government subsidises the interest for farmers, with a cap of 300,000 baht per household, or 20 tonnes of paddy.

For their part, the farmers keep the paddy until the time is appropriate to sell it. Farmers who don't have barns can join through cooperatives.

The government approved the programme in late October 2015. For 2015, the crops were limited to jasmine and glutinous paddy in the North and Northeast. The maximum pledged amount was 2 million tonnes for a maximum credit line of 26.74 billion baht.

The pledged prices were up to 13,500 baht a tonne for jasmine paddy and 11,300 baht for glutinous paddy, or 90% of the market prices at the time.

Critics said the cap at 2 million tonnes was less than a third of the 7-million-tonne output of the two varieties.

Because of the restrictions and higher rice prices at the time, 80,000 farmers pledged 450,000 tonnes for loans totalling 6.39 billion baht for the 2014-15 crop year, according to BAAC data as of March 31, 2015.  

Rice prices around the world have fallen as a record crop is forecast for the 2016-17 harvest season, the UN Food and Agriculture Organization (FAO) said in its latest Rice Price Update.

The FAO’s All Rice Price Index showed international rice prices in the first eight months of 2016 were 9% below the levels of a year earlier

The International Grains Council (IGC) also noted a sharp fall in export prices of Thai rice in August.

“The market in Thailand was weighed down by sluggish international demand and increasing secondary crop arrivals, while additional pressure stemmed from efforts by the government to offload state reserves through a series of auctions,” it said. “At $369 [a tonne], 5% broken rice was down by $43 month-over-month."

Farmers in Buri Ram say they have no choice but to accept as little as 5,000 baht a tonne for their rice.

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