Government caves in to rubber growers

Government caves in to rubber growers

PM agrees to buy at above-market price

Southern growers prepare latex for sale immediately after the cabinet reversed policy and approve the purchase of up to 200,000 tonnes of rubber at prices well above the market. (Post Today photo)
Southern growers prepare latex for sale immediately after the cabinet reversed policy and approve the purchase of up to 200,000 tonnes of rubber at prices well above the market. (Post Today photo)

The government has agreed to buy 100,000 tonnes of all types of rubber products directly from growers at an above-market price in an attempt to ease pressure on rubber farmers.

Speaking after a cabinet meeting Tuesday, Prime Minister Prayut Chan-o-cha did not reveal the purchase price but said it would be higher than the current 35 baht a kilogramme for latex.

"This should help farmers over the remaining three months before they stop tapping for the season. We won't buy from cooperatives," he said.

The cabinet had just approved in principle a framework put forward by Deputy Prime Minister Prawit Wongsuwon to provide assistance to rubber growers suffering from the price slump.

Under the framework, the government could buy up to 200,000 tonnes of rubber, with an earmarked budget of about 12 billion baht. The money will be drawn from a rubber development fund in the central budget for emergency purposes. State agencies will also contribute their own budgets to buy rubber.

The cabinet agreed that a suitable purchase price should not exceed 60 baht per kilogramme or 60,000 baht per tonne for the remaining three months before the rubber tapping season ends. During the next three months, rubber output is estimated at between 600,000-800,000 tonnes.

Maj Gen Kraiboon Suadsong, head of the government's working committee for negotiating with rubber farmers, said the meeting of the committee and representatives of rubber farmers in the South had reached an agreement.

The farmers agreed that the subsidy must be made at an appropriate price point but did not request 60 baht per kg. The committee will meet with relevant agencies to determine the subsidy price within two days, he said.

The farmers also requested the government accelerate payment of previous measures to help rubber farmers at 1,500 baht per rai. Many farmers have yet to receive the money.

However, a network of rubber farmers in the South has given the government 30 days to raise the price of rubber. More than 300 members of the Southern Rubber Growers Network attended a forum at the Rubber Authority of Thailand's office in Trang to discuss their demands.

The network will give the government 30 days to increase the price of rubber to 60 baht per kg, and it also wanted the government to give growers a greater role in solving the price slump themselves.

The network also welcomed Tuesday's cabinet resolution to appoint the new 15-member board of the Rubber Authority of Thailand, with two representatives of the network named as board members.

They are Thirapong Tantiphetcharaporn, the president of the Phangnga Rubber Growers Network, and Prasit Meedsen, acting director of the Office of the Rubber Replanting Aid Fund.

Mr Thirapong said he will push for measures to improve the welfare of rubber growers and their families, adding that the network's demands will be discussed again at a meeting of the National Farmers Council today before being presented to the Rubber Authority of Thailand for consideration.

Gen Prayut had previously ordered eight ministries -- Transport, Interior, Education, Public Health, Defence, Industry, Commerce and Agriculture -- to use their own budgets to buy rubber to boost domestic use of the product. He said the government will buy rubber from farmers and sell it to processing factories, which will in turn sell finished products such as mattresses, gloves and tyres to the government.

He acknowledged that Thailand had an output of 4.7 million tonnes of rubber while local demand was 1.4 million tonnes, so the country needed to increase usage by 30-50%. "We'll accelerate building new factories to make mattresses for the military and other products such as gloves. This will simultaneously support new operators," he said.

Gen Prawit said the armed forces will also send its personnel to help the Commerce Ministry's Public Warehouse Organisation to buy rubber from growers.

Tourism and Sports Minister Kobkarn Wattanavrangkul said after the meeting the ministry would buy 3,000 tonnes for sports grounds and pathways at tourist destinations, as well as wrist bands to promote tourism.

Boonsong Napthong, president of the Federation of Thai Rubber Farmers, welcomed the cabinet's resolution to buy 100,000 tonnes of all types of rubber products.

He believed the decision would help push the rubber price up to 60 baht per kg within 30 days. Continued government assistance would also help stabilise the price in the long run, he said.

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