Thai rice exports are on course to hit the 11 million tonnes mark by the end of this year, and, for that matter, Thailand has reclaimed the title of being the world's No.1 rice exporter. This will be the biggest rice sale since 2004, when 10.4 million tonnes of rice were exported. It is also a major surprise for the rice industry. Earlier projections put exports for the whole year at just 8.5 million tonnes.
Officials at the Commerce Ministry may rejoice at the unexpected achievement thanks to the price competitiveness of Thai grains and the accelerated efforts to offload the huge stockpiles built up last year because of the Pheu Thai Party's poorly thought-out and executed rice-pledging scheme. It is a huge relief that the rice stockpiles have been steadily dispensed with; otherwise they may have rotted because of being kept in storage for too long.
But, as a matter of fact, there is no cause to rejoice or for celebration over the impressive rice export figure or the regaining of the world's top rice export ranking.
It is an open fact there are no profits for every tonne of rice exported either through government-to-government deals or by the private sector. There are losses for every tonne, and the extent of the loss depends on how low the sales price was — the cost of the rice bought under the rice-pledging scheme was 40-50% above market prices.
Thai farmers have always been at the receiving end of the rice industry with the smallest share of the cake. When export prices are good and rice exports jump, it is the exporters who reap the most benefits.
And the No.1 world's ranking means little for the farmers and is unlikely to improve their livelihoods, although it may fatten the wallets of the rice traders, from millers to exporters.
It is ironic that Thai farmers are the poorest among farmers among Asean's rice-producing countries while the country is on course to regain the world's title of top rice exporter.
A report by the International Trade Studies of the University of Thai Chamber of Commerce shows net income for Thai farmers at 1,555 baht per rai compared with Vietnam's 3,180 baht per rai and Myanmar's 3,481. Rice productivity in Thailand averages 450kg per rai, compared with Vietnam's 862, Indonesia's 779 and Laos' 588.
If this depressing trend continues, the report noted that in 10 years Thailand's earnings from rice exports will shrink by about 8 billion baht a year unless productivity is increased and production costs are cut substantially.
The government said it is pondering overhauling the farming system. This would include a cutback in rice farmland with incentives for farmers to turn to other crops, or programmes to help retool farmers for other occupations. Whatever the plans, they must be done on a voluntary basis.
Research and development on high-yield and pest-resistant strains of the plant is an area which needs to be improved with more funding and incentives. It should be noted that Vietnam has spent more than Thailand in this important area.
Farmers have always been treated by successive governments like a sick man who needs to be pampered and helped with such populist schemes as rice pledging or price guarantees.
But with proper support, technical help and up-to-date information backup, farmers are capable of standing on their own feet.