Panel okays rubber price initiative

Panel okays rubber price initiative

The National Rubber Policy Committee yesterday agreed in principle to the second phase of the rubber price guarantee scheme, but told the Agriculture and Cooperatives Ministry to lower its budget to 30 billion baht from 43 billion.

Prapan Boonyakiat, chairman of the Rubber Authority of Thailand, said the committee chaired by Prime Minister Prayut Chan-o-cha also decided to lower its support to only 15 rai per family from 25 rai proposed by the Agriculture and Cooperatives Ministry, citing budget limitations.

The ministry is scheduled to propose the second phase of the price guarantee scheme for the cabinet's approval on June 9.

Mr Prapan said the committee agreed the government should assist both farmers who own land and those who just work the land.

The scheme is expected to begin sometime from June to November this year, with the guaranteed price set at not more than 60 baht per kilogramme for raw rubber sheets.

The state-owned Bank for Agriculture and Agricultural Cooperatives (BAAC) will be tasked with handling the price guarantee scheme.

The government implemented the first phase of the rubber price guarantee scheme with a budget of 24.3 billion baht in October last year, helping 1.7 million farmers covering 17 million rai of rubber plantation.

In a related development, Commerce Minister Jurin Laksanawisit said the committee also yesterday approved a 20-billion-baht loan scheme for rubberwood entrepreneurs.

Under the lending scheme, the government will subsidise a 3% interest rate a year worth about 600 million baht.

The committee also approved another 20-billion-baht loan to rubber block entrepreneurs, offering a 2-3% interest rate worth 600 million baht.

The Agriculture and Cooperatives Ministry also reported on the progress of the programme to support loans for agricultural cooperatives to buy rubber and store it to shore up prices.

The ministry reported the cooperatives already borrowed 11.8 billion baht from the BAAC, with rubber processors borrowing 2 billion and entrepreneurs borrowing 14 billion to increase the value of rubber.

In 2019, according to the Commerce Ministry's statistics, Thailand ranked as the fourth largest exporter of rubber products and processed rubber, trailing China, Germany and the US.

Such exports totalled US$11.2 billion last year, up 2%.

Key markets included the US, China, Japan, Asean and Australia, with auto tyres accounting for 51% of the shipments, followed by synthetic rubber and rubber gloves at 19% and 11%, respectively.

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