The rice policy subcommittee has agreed to adopt three measures to shore up falling second-crop paddy prices, as crops are now being harvested. The measures are to be submitted to the National Rice Policy and Management Committee next week for ratification.
According to Commerce Minister Pichai Naripthaphan, farmers will be granted credit of 1,500 baht, for every tonne of paddy they store in their rice barns for up to 5 months.
If they store their crops in the barns of their cooperatives, they will each receive a credit of 1,000 baht and 500 baht for the cooperatives. Pichai said this measure alone will keep 1.5 million tonnes of paddy in storage for at least a month, instead of being sold which would further drive paddy prices down.
The second measure is interest compensation, of up to 6%, for rice millers who agree to stockpile rice for 2-6 months, on the condition that they buy paddy from farmers at 200 baht/tonne above market price. About two million tonnes of paddy are expected to be stockpiled through this measure, said Pichai.
Finally, the Commerce Ministry is to open markets for rice traders to buy paddy directly from farmers, with the ministry funding management fees of 500 baht per tonne sold in these markets. Traders must buy paddy at 300 baht/tonne more than the market price. About 1.8 billion baht will be needed to fund this measure and about 300,000 tonnes of paddy are expected to be bought by traders this way.
Deputy Commerce Minister Napintorn Srisunpang said that the three measures will push paddy prices to 8,000 baht/tonne, instead of about 7,000 baht.
Pramote Charoensilp, president of the Farmers Association, said that his members want to sell their crops at a minimum of 8,000 baht/tonne, because their production costs are estimated at between 5,000 and 6,000 baht/tonne.
He also said that farmers want the government to guarantee the price of paddy at 11,000 baht/tonne, 13,000 baht/tonne for Hom Mali fragrant rice, 12,000 baht/tonne for Pathum Thani fragrant rice and 11,000 baht/tonne for sticky rice.
