Rice farmers demand better support as prices plummet

Thai government measures to support rice farmers have failed to meet expectations, with some growers in the world’s second-largest rice exporting country vowing protests as they are squeezed between falling prices and rising cultivation costs.

Paddy prices have dropped by 30% year-on-year to an average of about 8,600 baht ($256) per ton this month, the commerce ministry said, piling pressure on the Pheu Thai party-led government to placate rice farmers – a key vote bank.

“We are not happy with the measures. I think the government is not sincere with farmers at all,” said Thitiwat Kleepmalai, a farmer leader from Ayutthaya province who had submitted his group’s demands to the government on Wednesday.

The government on Thursday announced measures worth 1.89 billion baht, including providing loans for farmers to delay paddy sales, assisting with storage fees, and covering interest costs for rice mills to store the crop.

These measures, which are yet to be approved by the cabinet, are part of an effort by the government to keep paddy prices above 8,000 baht per ton, Commerce Minister Pichai Naripthaphan told reporters.

The Ayutthaya group had asked the government to either help them sell rice at 11,000 baht per ton, or provide a guaranteed price at the same level, as production costs are as high as 6,500 baht per ton, Thitiwat said.

Thailand’s centuries-old rice cultivation system is under severe stress from climate change, unsustainable farm debts and a lack of innovation, despite tens of billions of dollars in subsidies over the past decade.

Thitiwat said his group will meet with other provincial farm leaders to organise a larger protest in Bangkok this month, following an earlier rally.

Pui Saengnak, another farmer from Ayutthaya, said if there are no further measures, he and other rice growers will take to the streets in large numbers.
“Farmers are suffering greatly,” he said.

The resumption of rice exports by India – the world’s largest shipper of the grain – is likely to hit Thailand hard, with the commerce ministry expecting a 24% year-on-year decline in rice exports to 7.5 million tons this year.

That will follow a 13.4% rise in rice shipments to 9.95 million tons last year, the highest level in six years, according to the commerce ministry.