The cabinet on Tuesday approved measures worth 55 billion baht to stabilise rice prices for the 2023/24 harvest.
Commerce Minister Phumtham Wechayachai said the measures approved involve loans to farmers to delay the sale of paddy rice with a moisture level of 25% for a period of five months, along with loans to agricultural cooperatives to intervene in the market to buy paddy rice until prices become more favourable.
Under the loan measure for farmers to delay the sale of their paddy rice for a period of five months, the government will intervene in the market, offering farmers who agree to participate in the scheme 12,000 baht per tonne and an additional 1,500 baht per tonne for storage. The government aims to absorb 3 million tonnes under this scheme.
With reference to the measure for agricultural cooperatives to intervene in the market to purchase paddy rice, the government will support the purchase of Thai hom mali fragrant rice in the market at 12,200 baht per tonne, with the aim of absorbing 1 million tonnes. The two measures would require the government to spend roughly 55 billion baht in total.
Referring to an earlier measure supporting the development of rice quality at 1,000 baht per rai, which cannot exceed 20 rai per household, involving a proposed budget of 56 billion baht, Mr Phumtham said the proposed measure would first need approval from the National Rice Policy Committee (NRPC) on Nov 10.
Mr Phumtham also insisted that the government is committed to offering the 1,000 baht per rai to farmers, but is struggling to find a suitable format.
Government spokesman Chai Wacharonke said the government is planning to modify its intervention policy on rice prices during the next harvest season. The adjustments aim to improve farmers' incomes by reducing subsidies.
The new policy first needs to be discussed with the farmers on the subject of whether to improve production efficiency or adopt technological solutions, he said.
According to Mr Chai, the market price for hom mali paddy rice is about 14,800-15,000 baht per tonne with a moisture level of 15% at present. However, once harvested, the moisture content normally reaches 25%, resulting in selling prices of roughly 12,000-12,300 baht per tonne. The market price stands at only 11,000 baht per tonne at present, which is considered to be less than a fair price.
In light of this, the Agriculture and Cooperatives and the Commerce Ministry have proposed two measures to intervene in the market to absorb excess rice and increase prices.
In a related development, the cabinet yesterday approved two measures to stabilise the prices of animal feed corn in the 2023/24 harvest season, with a combined budget of 65.1 million baht. The budget aims to support agricultural institutions and business entities in purchasing and storing animal feed corn without expediting their release into the market and stabilise prices when the market faces a high level of supply.
The measures also involve interest rate subsidies for agricultural institutions and business entities to hold their stocks for a period of 60-120 days to regulate excessive supply.