The government is considering a debt suspension plan worth 1.4 billion baht for tapioca farmers who are feeling the pinch from the sharp fall in tapioca prices.
Wiboonlasana Ruamraksa, director-general of the Internal Trade Department, said the plan would be proposed to the national tapioca policy committee, which is meeting on Thursday, and to the cabinet for approval the following week.
Debt suspension would be offered for two years to farmers, with maximum borrowing of not more than 500,000 baht per household.
Currently, almost 600,000 families of tapioca farmers have registered with the Agriculture and Cooperatives Ministry.
The proposed debt suspension scheme will help persuade farmers to delay their harvest, she said.
Earlier last month, the cabinet approved soft loan packages worth 5.36 billion baht to help cassava farmers, who have been hit by falling tapioca prices.
Cassava root prices with 25% moisture are now quoted at 1.7-2 baht a kilogramme, down sharply from 2.3 baht a kg in the same period last year.
Of the total budget, some 372 million baht will go to subsidise a 3% loan interest rate for the state-owned Bank for Agriculture and Agricultural Cooperatives, with 2.3 billion baht to increase productivity through a special interest rate of 4% a year.
Another 1.5 billion baht is for cooperatives to process tapioca with a 1% loan interest rate. The rest is for small farmers and cooperatives to upgrade their production and processing standards, with the government subsidising a 3% interest rate.
Ms Wiboonlasana said the department plans to hold talks with banks and financial institutions to find ways to ease the liquidity constraints for tapioca starch factories and cassava ground entrepreneurs who buy cassava roots from farmers.
The department has tried its best to diversify tapioca export markets, reaching out to India, South Korea, Japan and Europe to cut Thailand's dependence on China, she said.
On the domestic front, the department also plans to promote tapioca processing, not only into food products but also for alternative energy such as ethanol production.