Rice policy: Thailand to lose top ranking

India or Vietnam set to become #1 in world rice exports as expensive govt rice purchases sit in warehouse.


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EDITORIAL

Rice scheme needs rethink

19-07-2012

Thailand is on the brink of losing its status as the world's number one rice exporter to either India or Vietnam, thanks to the government's populist rice mortgage scheme. According to the respected economic think-thank the Thailand Development Research Institute, rice exports have dropped by 44% year-on-year since January this year.

But the grim prospect of losing its top place in the export rankings and of lost pride appears to pale when compared to the financial loss in supporting the scheme and the longer-term impact to the economy if this populist policy is not reviewed or scrapped soon enough.

The scheme, introduced last September as a flagship populist policy of the government to curry favour among farmers, has cost the government about 270 billion baht for paddy purchases.

Of this huge amount of spending, 90 billion baht has come from the coffers of the state-run Bank for Agriculture and Agricultural Cooperatives, BAAC president Luck Wajananawat said.

About 11 million tonnes of paddy or eight million tonnes of milled rice will have been purchased under the mortgage scheme by the time the first phase of it ends next month.

Since the rice was bought by the government through the BAAC at 15,000 baht a tonne for ordinary rice and 20,000 baht a tonne for Hom Mali fragrant grains which are about double the normal market prices, the government stands to lose US$350-400 baht a tonne of rice if stockpiles are sold now on the world market.

That means the government will lose 130-140 billion baht if the eight million tonnes of stockpiled rice are to be cleared from warehouses across the country.

So far, the bulk of the rice bought under this populist scheme is still held in warehouses nationwide.

But whether the actual amount will match with the purchase figures will only be known when the rice is actually sold to exporters or sold by the government in government-to-government deals.

The huge stockpile will pose a real problem with the arrival of new harvests when warehouse space is needed to store new rice to be bought under the scheme.

Besides the space problem, the rice quality will drop if the grains are kept for too long and they will fetch much lower prices. Pressed with these dual problems, the government may be forced to sell on the cheap.

There is no doubt the government will suffer a loss if it wants to dispose of the massive rice stockpile to make room for the arrival of new rice purchases. The point is how big a loss. This depends on the efficiency of the government, or the Commerce Ministry in particular, which is, at best, questionable.

The government has good intentions in helping farmers earn more from their crops even though it also expects to win their votes during the election.

The loss burden from the rice mortgage scheme may be acceptable if the farmers are the only real beneficiaries of the scheme. However, others have benefited much more than the farmers, such as millers, brokers, corrupt politicians and officials.

Other means can be found to help the farmers earn better incomes, but regrettably none have been seriously pursued by any government from the past to present. One such method is to help them increase productivity and reduce their dependence on the use of fertiliser and pesticides which have added substantially to their production costs.


Rice Policy Vocabulary


scheme - a plan that is developed by a government or large organisation in order to provide a particular service for people แผนการ โครงการ
rice scheme
rice scheme needs rethink

brink - the point in time when something very bad or very good is about to happen
on the brink
of

status - the situation at a particular time; the state of affairs at a particular time สถานะ
losing its status

populist - a politician who claims to care about the interests and opinion of ordinary people

rice mortgage scheme -
the government program for protecting farmers from price changes
populist
rice mortgage scheme

respected - admired by many people for your qualities or achievements ที่เคารพ
think-tank - a research organization
the respected economic think-thank

year-on-year - a period this year compared to the same period last year (month, quarter, half year)
rice exports have dropped by 44% year-on-year

Thailand is on the brink of losing its status as the world's number one rice exporter to either India or Vietnam, thanks to the government's populist rice mortgage scheme. According to the respected economic think-thank the Thailand Development Research Institute, rice exports have dropped by 44% year-on-year since January this year.

grim - unpleasant and making you feel upset and worried; epressing, and difficult to accept ที่โหดร้าย
prospect - the possibility that something will happen in the future ความคาดหวัง ความหวังข้างหน้า อนาคต

the grim prospect of

rankings - a list with the best first and the worst last

export rankings - how much or how well compared to others (example: top ranked, ranked first)
losing its top place in the export rankings

pride - feeling good and satisfied about what you and people close to you have achieved  (example: about an accomplishment; pride in your daughter's high  grades) ความภาคภูมิใจ
lost pride

pales in comparison with - is much less than

financial loss
- losing money

impact - an effect or influence ผลกระทบ
longer-term impact
longer-term impact to the economy

policy - a plan of action to guide decisions and achieve outcomes นโยบาย (See Wikipedia)
populist policy

reviewed
- look at a project or policy closely to see if it is worth continuing (if not then stop or scrap)
scrapped - end doing; stop some project or policy   ยุติแผนที่วางไว้

But the grim prospect of losing its top place in the export rankings and of lost pride appears to pale when compared to the financial loss in supporting the scheme and the longer-term impact to the economy if this populist policy is not reviewed or scrapped soon enough.

flagship - the most important in a group of things owned by a company (for example: flagship company, flagship publication) (See glossary) ที่เป็นตัวนำ ที่สำคัญที่สุด
flagship populist policy

favour - 1. something you do for someone in order to help them สิ่งที่ทำให้เป็นพิเศษด้วยความชื่นชม; 2. to give an advantage to someone or something, often in an unfair way ช่วยเหลือ

curry favour -
do something to make people like you
curry favour
among farmers

paddy - rice after it has been harvested from the field  ข้าวเปลือก
paddy purchases

270 billion baht for paddy purchases

The scheme, introduced last September as a flagship populist policy of the government to curry favour among farmers, has cost the government about 270 billion baht for paddy purchases.

coffers -
1. money that an organization has; 2. a place where you keep money

state - government รัฐ
state-run

the coffers of the state-run Bank for Agriculture and Agricultural Cooperatives

milled rice - rice that has been processed so it can be sold in stores or stored for future sale and possible export

Of this huge amount of spending, 90 billion baht has come from the coffers of the state-run Bank for Agriculture and Agricultural Cooperatives, BAAC president Luck Wajananawat said. About 11 million tonnes of paddy or eight million tonnes of milled rice will have been purchased under the mortgage scheme by the time the first phase of it ends next month.

double - to become twice as big, twice as much or twice as many เพิ่มเป็นสองเท่า
double the normal market prices

stands to lose - could lose or will lose (if some event happens) (example: I stand to lose 100 baht in a bet if Manchester United loses)

stockpiles - large amounts of something stored for future use กองสินค้าในโกดัง
stockpiled rice

Since the rice was bought by the government through the BAAC at 15,000 baht a tonne for ordinary rice and 20,000 baht a tonne for Hom Mali fragrant grains which are about double the normal market prices, the government stands to lose US$350-400 baht a tonne of rice if stockpiles are sold now on the world market.

clear - move things out from a place (so the place is empty)
cleared from the warehouses

That means the government will lose 130-140 billion baht if the eight million tonnes of stockpiled rice are to be cleared from warehouses across the country.

bulk - large amounts เป็นจำนวนมาก เป็นกุรุศ จำนวนมาก
the bulk of the rice

nationwide - throughout a whole country ทั่วทั้งประเทศ

So far, the bulk of the rice bought under this populist scheme is still held in warehouses nationwide.

actual - real; existing in fact จริง
actual amount - the real amount

match - to be the same as or very close to something else ซึ่งไม่คู่ควร

purchase
- buy 
figures - statistic, numbers describing the economy
purchase figures

stockpile - large quantities of goods stored for future use คลังสินค้า  จำนวนสินค้าที่เก็บตุนไว้เป็นจำนวนมาก

pose - to create a dangerous or difficult situation เป็นเหตุให้
pose a real problem

arrival - when someone reaches where they are going (arrives) ขาเข้า การเข้ามา
warehouse - a large building for storing things โกดังสินค้า, คลังสินค้า, โรงพัสดุ
warehouse space

But whether the actual amount will match with the purchase figures will only be known when the rice is actually sold to exporters or sold by the government in government-to-government deals. The huge stockpile will pose a real problem with the arrival of new harvests when warehouse space is needed to store new rice to be bought under the scheme.

fetch - to be sold for a particular amount of money ขายในราคาหนึ่ง
fetch much lower prices

pressed with - put in a dfifficult situation, put in a sittuation with pressure 

Besides the space problem, the rice quality will drop if the grains are kept for too long and they will fetch much lower prices. Pressed with these dual problems, the government may be forced to sell on the cheap.

doubt - not know for sure if something is true or false, uncertain
there is no doubt that ...

suffer - to experience pain
suffer a loss - to lose money (painful)

dispose - to throw away or get rid of ทิ้ง
dispose of the massive rice stockpile

massive - very large in size, amount or numberใหญ่โต มหาศาล

make room for - to create an area or space so you can put something new there
make room for the arrival of new rice purchases

efficiency - waste little time, energy and resources in doing a task (minimize time, energy and resources in performing a task) (See glossary) การทำงานอย่างมีประสิทธิภาพ คุ้มค่าเวลาและใช้พลังงานหรือต้นทุนในการผลิตน้อย เพื่อให้ได้ผลผลิตมาก
the efficiency of the government

questionable - involving doubts about whether something has been done properly ที่น่าสงสัย
... which is, at best, questionable.

There is no doubt the government will suffer a loss if it wants to dispose of the massive rice stockpile to make room for the arrival of new rice purchases. The point is how big a loss. This depends on the efficiency of the government, or the Commerce Ministry in particular, which is, at best, questionable.

intentions - plans in you mind about what you are going to do ความตั้งใจ เจตนา
good intentions - good things that you want to happen from your actions

election - the process of choosing a person or a group of person for a position, especially by voting elect (v) electoral (adj) synonym: the polls การเลือกตั้ง
win votes during the election

The government has good intentions in helping farmers earn more from their crops even though it also expects to win their votes during the election.

burden - a responsibility, a difficult thing that must be done or accepted, a heavy load to carry ภาระ (See glossary)
loss burden - when you lose money (and it is difficult, makes life more difficult)

The loss burden from the rice mortgage scheme

beneficiaries - people who receive money from some programme 
the real beneficiaries - the people who really gain (not those who only seem to gain)

the real beneficiaries of the scheme


The loss burden from the rice mortgage scheme may be acceptable if the farmers are the only real beneficiaries of the scheme. However, others have benefited much more than the farmers, such as millers, brokers, corrupt politicians and officials.

regrettably - sadly (wishing it didn't happen)

productivity - producing more for the same amount of resources (labour, capital, machines) การผลิตสินค้า
dependence - cannot do without, need การพึ่งพาอาศัย

fertiliser - food for plants, chemicals to make plants grow faster ปุ๋ย (See Wikipedia)
pesticides - chemicals that kill the insects that eat or damage crops

Other means can be found to help the farmers earn better incomes, but regrettably none have been seriously pursued by any government from the past to present. One such method is to help them increase productivity and reduce their dependence on the use of fertiliser and pesticides which have added substantially to their production costs.